WIRELESS SYSTEMS LOOK TO CONNECT
By Jon Van
When Rick Hud, a local representative of the Puerto Rico convention
board, downloads fat computer files from San Juan, it takes only a few
minutes. A year ago, it took all morning.
Jordan Firfer, vice president of a firm that provides computer
services to insurance companies, was looking for an ultra-fast
connection between his Chicago office and customers throughout the
country. He got it, for what he considers a bargain price: $600 a
month.
Hud and Firfer are beneficiaries of the latest trend in
telecommunications: the race toward high-speed "broadband"
connections, using wireless technology rather than traditional phone
lines. Both men use data connections supplied by Winstar
Communications Inc., which has antennas atop tall buildings here that
beam wireless high-capacity broadband links to downtown offices.
Winstar is one early provider of a technology that should reach into
residential neighborhoods within a year.
Demand for high-speed Internet links is rampant, and telecom providers
are pursuing all available means of providing service. Ameritech
parent SBC Communications Inc. is spending $6 billion to upgrade its
traditional phone systems to carry high-speed data, and AT&T Corp. is
shelling out about $100 billion to acquire and upgrade cable TV
systems to become broadband Internet conduits.
But others are concentrating on wireless broadband links. Nimble
smaller players like Winstar and Teligent Inc. are rushing into that
segment of the market, which offers consumers a growing array of
wireless connections between broadband networks and business
customers.
Rewiring existing cable TV and telephone networks to bring high-speed
Internet to the masses costs a bundle, may require ripping up streets
and takes years of work to complete. So some companies look to
wireless technology as a shortcut to sell high-speed Internet access
before it is available over traditional lines and cables.
Nor is wireless broadband technology only fit for business users. MCI
WorldCom Inc. and Sprint Corp. are looking to wireless technology to
bring high-speed Internet links to residential neighborhoods.
Wireless technology eliminates the need to hook a line of fiber,
copper or coaxial cable from the network's main "trunk" phone line to
the customer's house or place of business. Once an antenna is built,
any customer premises within range can join the network by installing
a receiver.
This can save a lot of money, especially in residential neighborhoods
where it can cost hundreds of dollars to reach an individual home with
a network connection line. But even in densely populated downtowns
where ultra-high capacity fiber networks are abundant, wireless can
save time and money, said William Rouhana Jr., Winstar's chief
executive.
"Putting fiber into a building isn't cheap, even when a fiber trunk
runs across the street from you," said Rouhana.
Winstar's main competitors in selling high-speed Internet access to
small businesses are the digital subscriber line (DSL) services
offered by numerous telecom firms. The biggest problem facing DSL
providers is that they must use existing copper phone lines owned by
dominant Bell phone companies like SBC's Ameritech.
"With DSL, you live and die by what the Bell company does," said
Nathan Kantor, Winstar's president. "And most of the time they don't
deliver for you."
The main drawback to wireless broadband technology is making it work.
Before AT&T opted to get into cable TV, it tested a wireless
technology intended to reach homes directly with phone service. But
the performance wasn't good enough to commercialize, and the
long-distance giant decided instead to use cable TV systems to reach
customers directly.
Wireless technology has improved since then, according to Winstar
customers Firfer and Hud.
Before Firfer's computer-service business, Affiliated Network
Services, decided to use Winstar as its Internet carrier, Firfer was
concerned, he said, that the attractive rates might indicate a shaky
company that lacked customers. But that hasn't proven true, he adds.
"I was worried about storms and lightning and how that might affect
service," Firfer said. "But we've had several nasty storms since we
started with Winstar and things worked just fine."
Both MCI WorldCom and Sprint decided a few years ago that broadband
wireless was solid enough technologically that they bought several
small systems around the country that had been offering niche wireless
services such as so-called wireless cable television.
Since MCI and Sprint, the No. 2 and No. 3 long-distance companies,
announced last year their intention to merge, their commitment to
wireless broadband has become even more significant. Regulators have
questioned the size of the Internet backbone and business data markets
that a combined Sprint/MCI will control. It will exceed AT&T's.
By stressing their intention to bring another competing broadband
telecommunication service to residential customers, the two firms hope
to persuade regulators that the competitive advantages of their merger
should outweigh regulatory concerns.
Sprint, which bought the People's Choice wireless cable system in
Chicago, intends to begin offering wireless broadband data here later
this year, said Robert Hoskins, a Sprint spokesman. "Our supercell
atop the Sears Tower reaches out 35 miles," Hoskins said. "If you can
see the Sears Tower from your house, chances are good that you could
get our signal."
Earlier this month MCI WorldCom announced it would test broadband in
several cities to determine how viable it was for various
applications. One such test in Dallas is being conducted with Motorola
Corp. and Cisco Systems Inc. to determine if new technology can
overcome the current need to have a clear line of sight between
antenna and receiver, said Joe Paluska, an MCI/WorldCom spokesman,.
In some sparsely populated suburban and rural areas where DSL and
cable TV systems don't venture, broadband wireless may be the only
option for customers who want high-speed Internet connections, Paluska
said.
The specific radio systems used by Winstar, Teligent, Sprint and MCI
WorldCom differ from one another in details, but are referred to in
general as "fixed wireless" to suggest they are different from mobile
wireless systems used to make pagers and cell phones work.
But that general distinction may not last much longer, said Robert
Sellinger, director of wireless architecture for Lucent Technologies
Inc., based in Naperville.
The next generation of mobile wireless technology improves reliability
and capacity so greatly that it will become a direct competitor to
wire-line telecommunications, much as fixed wireless was designed to
be, Sellinger said.
"We don't see a big distinction," he adds. "We have large commercial
trials in July scheduled with Sprint and Bell Atlantic where you
double your network capacity. We expect to see that commercialized
next year."
If Sellinger is right, then every wireless phone operation becomes a
potential full-service system offering high-speed Internet and voice
service to residential customers in competition with incumbents like
Ameritech and cable services like AT&T.
And if that happens, the wireless cost advantages will turn the
industry upside down, said Robert Rosenberg, president of Insight
Research Corp., a telecommunications consultancy based in Parsippany,
N.J.
"You've got AT&T spending hundreds of billions to acquire and build
its system while MCI and Sprint spend tens of billions on their
systems," Rosenberg said. "In both cases, they're gambling, but the
stakes are much higher for AT&T.
"It won't be long before these companies will give away traditional
voice service for free to customers who take their broadband Internet
service." And that, said Rosenberg, is likely to send a shock wave
through the telecom industry. |
