Intel invests in wireless broadband business

Intel has made an undisclosed investment in Formus Communications, a US-based company that has interests in broadband wireless access companies in Europe and Latin America.

In a statement yesterday, Intel said the move will help Formus expand its networks and broadband coverage for small and medium-sized businesses, and increase its business activities in Europe.

Intel officials could not be immediately reached for further comment.

Broadband wireless access provides users a lower-cost alternative to fixed-line local phone networks and leased lines for data, often still operated by former monopoly carriers in Europe. Users can receive voice, data, multimedia and Internet services at speeds starting at around 2M bits per second. Due to their cost, such services are mainly aimed at corporate users.

Denver-based Formus specializes in building and maintaining networks based on WLL-PMP technology (wireless local loop-point to multi-point), which uses frequencies in the areas of 3.5GHz and 26.6GHz. Traffic is transmitted via radio signal from a building to a nearby base station, from which it can then be sent on to a number of other points.

Formus has launched commercial broadband wireless access services in Poland, has trial projects underway in France and Hungary, where it hasn't yet gained permanent licenses, and has a license to operate in Finland, according to information on the company Web site. Formus also holds interests in VeloCom Inc., which holds broadband licenses in Colombia, Peru and Argentina, and Brazil.

Separately, in a statement last week, Formus said it has purchased the remaining share in Callino GmbH, a German wireless access provider in which it already owned a share, from Chase Capital Partners. Callino launched telephone services for German consumers earlier this year, and is building an IP-(Internet protocol)-network from which it will offer corporate users broadband services, through a combination of wireless and fixed-line networks.

In Germany, former monopoly carrier Deutsche Telekom AG still owns 90 percent of the local phone network. Seeking to increase competition in the local loop, German regulators in August awarded 12 licensed carriers with frequencies for operating wireless local loop networks.

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