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Clear joins access race with $120m rollout

By Nick Stride

Friday 10th March 2000

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Clear Communications is joining the race for customer access with a national wireless broadband rollout.

The carrier last week bought the five frequency bands acquired by Denver-based Formus International in the last government spectrum auction.

Clear already owns the sixth band and will spend $120 million on the first stage of a wireless voice, video and data service using local multipoint distribution service (LMDS) technology.

The move is similar in intent to Telstra Saturn's planned $1.1 billion national broadband network in that it will bypass Telecom's "last mile" network and provide direct access to customers.

But while Telstra Saturn will install cables to access homes and businesses, Clear intends to offer its service initially only to business customers.

The rollout will start in Rotorua and the Auckland suburb of Penrose, with the first customers connected by July.

Clear faces a battle to sign up customers with established player Walker Wireless as well as Wilson Neill acquisition Radionet.

Departing Clear chief executive Tim Cullinane said Clear had been developing LMDS in conjunction with its owner, British Telecom, for many months. BT had confirmed funding for the first stage.

Wireless technologies such as LMDS were a key component of the three-stage network rollout Clear announced in January.

He said the rollout did not remove the need for the ministerial inquiry into telecommunications.

"It certainly doesn't fix the underlying roadblocks to competition in the New Zealand market, which can be resolved only by local loop unbundling and genuine number portability."

Clear's existing fibre network will provide a substantial part of the backbone necessary for the new network. Once the backbone is in place customers can be connected easily by installing antennae on rooftops.

Under plans Formus announced previously, customers would have paid $8000 for customer premises equipment. Clear has yet to announce price details.

Formus operates extensive LMDS networks around Europe.

In 1998 it paid $2.4 million for five bands in the 26GHz range and said it would look to raise up to $100 million to deploy an LMDS network. Last October, however, it announced its plans for New Zealand were on hold while it concentrated on Europe.

Formus president Vern Kenley said his company would like to return to New Zealand "at some point" to help provide broadband services.

No price was disclosed for the spectrum sale but Clear is believed to have paid $US7.7 million ($16 million).

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