Posted at 10:21 p.m. PST
Monday, March 13, 2000
Delivering
fiber
speeds
without the wires
BY DAN GILLMOR
Mercury News Technology Columnist
SCOTTSDALE, Ariz. -- Everyone
wants fiber-optic speeds in their data
connections, and lots of companies have
been planting vast amounts of fiber to
carry so-called Internet backbone
traffic. Everyone also tends to agree
that optical fiber wires to homes and
businesses would be a great way to
bring high-bandwidth -- that is, fast --
Internet connections.
But the cost of laying all that fiber
would be immense.
Now, a Seattle company says it has
found a way to bring fiber speeds
without the wires -- using light waves to
carry the data. The idea is audacious,
but it may well be the kind of
technology that turns an industry in new
directions.
TeraBeam Networks, which is privately
held, has been working in stealth mode
since 1997. The company got its first
major public attention just last week,
when it announced it had lured Daniel
R. Hesse, president of AT&T Corp.'s
Wireless Group, to become TeraBeam's
chief executive. The technology itself
was unveiled here Monday at PC
Forum, a high-level industry conference
where linkages between the Old and
New Economies were high on the
agenda.
While the news of a big Old Economy
deal, Tribune Co.'s planned buyout of
Times Mirror Co., was greeted with
profound and almost universal
indifference, TeraBeam's presentation
created a significant stir. In a telling
commentary, I listened as an investment
banker asked Greg Amadon,
TeraBeam's founder, chairman and
chief technology officer, if it was too
late to get in on the company's next
round of funding.
If TeraBeam can deploy this bandwidth
as it claims, it has a chance to own
what people sometimes call a disruptive
technology -- a breakthrough that
wrecks old business models and inspires
new industries.
The company is aiming what it calls its
``fiberless optical' networks at
metropolitan areas, with transceivers on
customers' premises exchanging data
with TeraBeam devices installed around
a city in a pattern somewhat like a
mobile phone company's overlapping
cells.
But this isn't about radio waves. Light
itself will carry the signals.
The advantages, if this works as
advertised, are profound. First, the
bandwidth will be enormous -- several
gigabits per second. A gigabit is 1,000
megabits, and a megabit per second is
more than 20 times as fast as a typical
home modem connection.
Second, since it's wireless, the company
won't have to get rights-of-way and dig
up streets to install fiber.
Third, a customer won't need to mount
anything on the roof; the transceiver,
about the size of a satellite dish, can
send and receive data through an office
window.
If you're a home user and have begun
drooling at the prospects, grab a tissue
and calm down. This isn't for you, at
least not yet.
The TeraBeam service is aimed
squarely at businesses, universities and
other large enterprises that want to get
big data bandwidth at what could be a
very low relative cost. Still, the
relentless progress of technology
suggests this kind of thing might well be
available to consumers in not too many
years.
TeraBeam says the service will be
deployed commercially this summer.
The company is aiming to cover the top
50 U.S. cities and a number of
international cities within three years.
So, what's the catch? For one thing, the
technology requires clear line of sight
between each data node. It doesn't
work as well in dense fog, which is why
TeraBeam's test bed has been misty
Seattle, Hesse said. Just install more
cells to solve that problem, he added.
For another, it'll take real money to
deploy this, even if it does turn out to be
vastly cheaper than the competition.
The company has already raised $21
million in seed and early venture
financing rounds, and is just about to
close a third round of about $100
million, said Amadon.
But at a time when snagging top-level
executive talent is a tough job for
start-ups, TeraBeam clearly landed a
serious player.
Hesse, for his part, says he was dazzled
when he saw the technology. ``I'd never
seen anything as revolutionary as what
I've seen at TeraBeam,' he told me on
Monday. ``I didn't know this was
possible.'
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