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Out of the shadows - Wireless Internet service providers soaring PDF Print E-mail
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Written by Kory Mohr   
Friday, 30 September 2005
Amended from DenverPost.com:
WavMax Broadband has a wireless tower atop its Littleton building. Company officials include, from left, Tim Hopple, director of technology; Layton Schaelling, director of sales and marketing; David Dixon, director of operations; Mark Goosman, director of corporate development; and John Taylor, chairman and CEO. (Post / Hyoung Chang)

The estimated 3,000 wireless Internet service providers in the United States, known as WISPs, are becoming less wispy every day.

The mom-and-pop companies, which often have only a half-dozen radio towers and even fewer employees, have until recently lived only in the shadows of the large phone and cable broadband providers.

They subsisted by transmitting high-speed Internet across prairies, mountain valleys and rural hinterlands where neither cable nor DSL Internet lines reached.

But now WISPs are holding their ground - and possibly even gaining market share - as cable giants such as Comcast and phone companies such as Qwest push broadband into what were, until recently, WISP-only areas.

Of the 37.9 million high-speed Internet lines in the U.S. at the end of 2004, 21.4 million were cable, 13.8 million were DSL and 2.7 million were either satellite or land-based wireless, according to the Federal Communications Commission. During that year, wireless grew at 50 percent, cable grew at 30 percent and DSL at 20 percent.




The competition has not hurt Mesa Networks of Frederick, which recently ranked as the 12th-largest WISP in the nation. The company's clientele, now about 4,500 homes and small businesses between Longmont and Fort Collins, is growing 40 percent per year, according to company founder Todd Bergstrom.

Mesa offers 1.5 megabits-per-second Internet speed for $44 per month, including taxes, plus $49 for installation and equipment. That is about the same price and speed as Qwest, and a bit cheaper (though slower) than Comcast.

Like many WISPs, Mesa is also growing through acquisition of smaller rivals. The company purchased Peak Internet of Woodland Park in June, and is pondering three other acquisitions.

Other WISPs, like Littleton- based WavMax Broadband, are elbowing their way into urban areas by beaming data "pipelines" into office buildings.

One of WavMax's clients, Cresta Insurance Co. of Englewood, uses a WavMax connection as a backup to a high-speed T1 line leased from Qwest. The WavMax has worked three times over the last three years when the T1 failed.

"We knew our neighbors were down, but we were OK," said Cresta Vice President Bill Mescher, who said wireless is often cheaper and more effective than using another T1 line as a backup. Now Cresta has begun sending daily traffic over its WavMax connection.

WavMax's big plan, for which it is presently raising $10 million, is to build a "SkyFiber" ring around Denver, Colorado Springs and other cities.

The Denver ring, to be completed later this year, will connect directly to office buildings and provide an alternative to the fiber lines leased by Qwest and other companies.

WavMax has recently acquired five companies, giving it 85 towers from southern Arizona to Northern Colorado. Now WavMax is pondering acquisitions in western Colorado, Utah, Nevada and California.

"We want to provide  the railroad," said WavMax CEO John Taylor, who hopes to lease his "last-mile" building connections to corporate telecom providers like MCI, Sprint, SBC and Verizon. "We are already talking with all the major companies."

Traditional T1 lines lease from $400 to $600 per month. Taylor sells the same speed for $299 and says he still makes a hefty profit. But WavMax's competitive edge may not last long. Qwest and most other large telecom providers are testing Wi-Max, the next-generation wireless technology that could blanket huge portions of the country with speeds of 10-megabits-per-second or more.

Manufacturers of wireless-related equipment, like Lafayette-based AP Connections, are cashing in on the wireless boom. The company's product helps wireless broadband companies roll out their next big offering: Internet phone service.

One of AP Connection's WISP clients, Internet Colorado of Gunnison, has already rolled out Internet phone service up and down the Gunnison basin as far as Crested Butte. Now Internet Colorado is preparing to enter Grand Junction, where it will compete with Qwest and the local cable company.

Internet Colorado founder Jason Swenson talked on his mobile wireless handset as he walked to a Gunnison barbershop.

"When customers have a problem and they call the big companies, they are on hold for 45 minutes," he said. "We hear that all the time. That's one of our biggest selling points: We answer the phone."

One of Internet Colorado's clients is Crested Butte Printing, which began using the wireless connection three years ago to handle files as large as 500 megabits. Qwest installed DSL down their street recently, but the company is sticking with wireless.

"It's been working great," said company manager Chris Hanna. "Everything is rocking."

That kind of success has also encouraged Prairie iNet, a WISP based in Des Moines, Iowa, which is moving from rural areas into the edges of cites like Des Moines, Champaign, Ill., and even Chicago.

"We've gone through an evolution," said Prairie iNet CEO Neil Mulholland, who lives in Denver but commutes every week to Iowa.

"We're migrating into the edge of urban America."

Staff writer Ross Wehner can be reached at 303-820-1503 or at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it


 
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