New gear from Wavesat to enable quicker deployment of fixed wireless systems

PCS and satellite communications amplifier manufacturer, Wavesat Telecom Inc is beta testing a new broadband wireless modem that could produce cheaper and faster equipment for broadcast and high-speed Internet access players. The product, which has been designed around orthogonal frequency division multiplexing (OFDM) technology, promises to deliver bi-directional data rates significantly faster than other gear on the market today. The Montreal-based company expects to commercially release the OFDM modem within the next six months. Wavesat Telecom Inc could have a ready-made market if changes to older microwave licensing policies proposed by Industry Canada earlier this year are ratified. Spectrum in the 6 GHz frequency range, which is already lying under-used or dormant, could be liberated and opened up for re-licensing for different services. The company’s initial product offering will operate in this band, and will eventually operate in the other frequencies. The band was previously used as the primary telecom infrastructure backbone connecting cities. It’s since become redundant due to the wide spread laying of fibre optic networks across the country. While some of the small cable TV and Internet providers were concerned that if the spectrum was designated for other services, they would have to upgrade to newer technologies which would cost them significantly more to provide service to consumers in the rural areas of the country. More specifically, they were concerned that upgrading to digital TV signals would cost more than subscribers would be willing to pay. With the price points coming down for the type of equipment that Wavesat is developing, the company may be in a particularly enviable position compared to other equipment vendors. The Montreal-based firm will soon launch a broadband wireless modem that is capable of delivering voice, video and data at speeds fast enough for high-density urban areas. Smaller rural areas could take advantage of the new equipment to upgrade at a reasonable cost. Mark Holleran, CEO at the seven-year old firm, says the product is an ideal last mile system that can provide wireless cablecos, ISPs, CLECs and LMCS/LMDS service providers with a high-speed solution capable of offering converged services. Designed to initially operate in the 6 GHz broadcast channel and provide throughput at 25 Mbs, the product is frequency agnostic and can be tuned to work in other bands. This makes it well-suited for the broadcast market, as well as being capable of providing a wide range of service offerings to other markets, he says. Spectrum in this band may be soon opening up, as Industry Canada is considering changes to two older microwave licensing policies (RoW, May 1/00). Development of the product started about three years ago when Wavesat began exploring the potential of incorporating OFDM technology into broadband wireless equipment. Holleran expects to commercially release the first version of the OFDM modem early next year. He also hopes to begin testing a smaller version six months after that and a chip level application specific integrated circuit within a year of the first product’s release. Prior to the viability of such equipment, the price points for OFDM equipment using high-end digital signal processors (DSPs) were simply too high, he says. New design techniques and other technology advancements have enabled developers to use cheaper DSPs to make broadband wireless gear capable of delivering high data transfer rates at lower prices. The addition of Wavesat to the competitive market, along with incumbent developers Cisco Systems Inc and Wi-LAN Inc, should bring equipment prices more in line with what the market is willing to bear. "We can do those designs and bring the product down to a reasonable price point (which will lead) to more acceptance out in the industry," he says. Holleran explains that developing a product for the broadcast market enabled the company to address convergence in a seamless manner. "We really designed the product from the ground up to handle the convergence of voice, video and data," he told Report on Wireless. He adds that the engineering team "spent a lot of time on the algorithms to make the product very spectrally efficient." The company has two patents pending relating to the use of algorithms that enable the high-speed delivery of bandwidth-hungry applications. Patent approval is expected in the next few weeks. Financing critical to expansion of sales and marketing teams To complete testing and initiate further product development, the company secured $10.3 million in venture financing led by Skypoint Capital Corp of Kanata ON. Other investors in the private equity capital are the Business Development Bank of Canada and Manitex, along with a group of Taiwanese investors that includes the Hotung Group, Monet Group, Sunsino Group and Landmark Capital. One other notable investor is Taiwanese memory chip manufacturer Mosel Vitelic, which is seeking $1 billion in direct investment from the Canadian and Quebec governments to support a $3-billion chip plant in a Montreal suburb. Mosel has been guaranteed a 10-year tax haven from both provincial and municipal governments that amounts to approximately $1.7 billion. While a major chunk of this round of financing will go to product development and testing, Holleran says the investment will also help the company address one of its serious weaknesses: marketing. "We’ve been doing stealth marketing, no marketing (in other words). But it’s time for us to go out and actively do some marketing and raise some more capital," he says. Another round of financing to the tune of about $10 to $15 million will help the company beef up both its engineering, and sales and marketing teams. "I mean it’s pretty tight out there to get engineers, but our weakness has been sales and marketing, so we’re going to build that," he says. Holleran says the company will probably issue an IPO in about a year. Holleran readily admits that his company will be competing directly against the higher profiles of Wi-LAN and U.S. giant Cisco, but he is confident he can win marketshare. "We’re really getting a lot of interest from various investors, and what the analysts and other industry people are telling us is that we’re a little further ahead and have better performance," he told RoW. Investors have warmed up to the company because it already has an existing business. Wavesat has been manufacturing amplifiers for the satellite communications and PCS markets for the past seven years. "When we go out there and (analyst and investors) find out we have OFDM, it’s great," he says. "But when they see we have an existing business running and that we ship products internationally, we get a good reception."

New gear from Wavesat to enable quicker deployment of fixed wireless systems

News | October 16, 2000

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