Terabeam cuts 20% of its staff:
lightreading.com
SEPTEMBER 28, 2001
PREVIOUS NEWS ANALYSIS
Terabeam Scales Back
TeraBeam Corp. says it is laying off 90 employees, or 20 percent of its
450-person staff, due to a cutback in expansion plans.
The company last year raised $527 million in private equity, including $400 million
from Lucent Technologies Inc. (NYSE: LU - message board), in order to further
deployment of its wireless optical alternative to cable-based networks. Lucent
also contributed some intellectual property, which Terabeam values at $50
million.
Company spokeswoman Pam El says, the company still has more than half of
the invested cash. With the cutbacks, she adds, that money will be sufficient to
sustain the company "indefinitely" without resorting to more fund raising. Earlier
this year, the company stated it had enough money to carry it through the end of
2002.
Terabeam grew to a peak of 540 workers before the telecommunications
slowdown. It had planned to be in six cities by the end of the year but has now
cut that number to four. Following a March product launch in Seattle, where
company headquarters are situated, Terabeam is now providing service in Denver
and Dallas and will soon announce the fourth city, says El.
Terabeam’s use of so-called free space optical technology, pioneered by the
military during the Cold War, promises high-bandwidth wireless data connections
without the inconvenience of licensing radio frequencies from the government and
installing rooftop transmission equipment for corporate customers. Instead, a
transceiver the size of a small satellite dish plugs into a standard power outlet.
The technology also prevents eavesdropping and is touted for being able to
circumvent the hassles of installing fiber cable, which include digging up streets
and routing wire through walls.
Downsides, however, include the need to locate the transceiver in a window within
a line-of-sight of a Terabeam base station, installed on a service provider building.
Critics also note that the distance between the transceiver and hub can only be
about 500 yards, and certain weather conditions, like fog, can weaken the signal.
For these reasons, some industry observers believe the technology will never
achieve much more than a niche status.
Other companies providing high-speed laser data transmissions using free space
optical technology include AirFiber Inc., Canon, fSona Communications Corp.,
LightPointe Communications Inc. and Optical Access Inc..
Terabeam differs from many of these companies in that it also plans to be the
wireless data provider in the cities in which it launches, in addition to selling the
technology itself.
--Tom Davey, special to Light Reading, lightreading.com |
