LAS VEGAS (04/11/2000) - Sony Corporation of America today announced that it is investing US$8 million in U.S. wireless broadband company ArrayComm Inc. The Sony investment is designed to help speed the deployment of a new ArrayComm technology expected to bring high-speed Internet access, online gaming and multimedia content to a multitude of portable devices.
Called i-Burst, the technology can achieve far higher transmission rates than current cellular data networks -- as high as 40M bps (bits per second) in ideal conditions, and no less than 1M bps, ArrayComm officials said here yesterday.
The technology is also relatively inexpensive to deploy, which should allow the i-Burst network to achieve widespread coverage quickly, the officials said.
A market trial involving several thousand subscribers in the U.S. is planned for the second half of 2001, according to Arnaud Saffari, executive vice president and cofounder of ArrayComm. Commercial deployment in the U.S. will start in 2002 and the company hopes to cover the majority of the U.S. population by 2005, Saffari said.
The company also expects to begin rollout of the network in Japan in 2003 and in Europe in 2004, he added.
"We think the Internet has enormous potential so long as you can connect to it without hassles," Saffari said. "All being well, we hope to have several hundred million people covered in five to six years."
For Sony, the non-exclusive deal with ArrayComm will help accelerate the availability of affordable, high-speed Internet access for consumers and business users that, in turn, should provide the Japanese electronics maker with a fertile market in which to offer its own content, as well as devices such as laptops, gaming machines and other portable Internet appliances.
"Wireless is a new way, a new channel, to connect companies, services, consumers and service providers," Hiro Takahashi, a Sony U.S. spokesman, said in a phone interview today. "Sony is interested in exploring new services, combining our own technology with strong technology from other companies. Sony sees a growing potential for wireless Internet services."
While at this point Sony is not ready to name specific products and services that will use the ArrayComm technology, Takahashi said that the company is eyeing areas including wireless distribution of music and games, and connection services for PDAs (personal digital assistants).
Sony is the lead investor in a group that has provided ArrayComm with a total of $15 million of funding, ArrayComm announced today. Other backers include the investment firms Amerindo Investment Advisors Inc. and Ballentine Capital Partners.
The speed offered by ArrayComm technology has the potential for making the company's networking plan competitive, according to Scott Hamilton, chief operating officer for networking consultancy Tolly Research, a unit of The Tolly Group of Manasquan, New Jersey.
"The transmission speeds of 1M bps and up is what people are shooting for, for broadband wireless access, in technology like LMDS (local multipoint distribution service)," Hamilton said in a phone interview today. "But to really judge whether the business model makes sense, you have to get specifics on exactly what services will be offered, and what the incremental costs to the end-user will be."
ArrayComm expects service providers will roll out plans that will cost $20 or $30 per month for end-users, and that incremental hardware costs to include the necessary add-on card will be about $100 to $200, ArrayComm's Saffari said.
However, the company declined to specify which service providers and device manufacturers, other than Sony, ArrayComm expects to use its network.
I-Burst was pioneered by Martin Cooper, ArrayComm's chairman and chief executive officer, who has also been credited with having invented the modern cellular phone. [See "Column: WorldBeat: Father of Cell Phone Eyes a Revolution," Oct. 12, 1999.] At the core of i-Burst is a spatial multiplexing technology that ArrayComm has dubbed "IntelliCell." In essence, the technology uses specially placed antennas and software algorithms to pinpoint a user's location within a cellular network and then directs the communications directly at the user, making more efficient use of the radio spectrum. Network operators need fewer bay stations to roll out IntelliCell networks which brings costs down. The U.S.-wide network being built on ArrayComm technology will cost in the region of $2 billion to $3 billion, according to company officials.
The i-Burst network will also be less expensive to deploy than current cellular data systems because it uses a narrow band of the wireless spectrum -- just 10MHz -- and reduces the time and cost of building wireless infrastructures, as well as the expense of operating the access network, according to ArrayComm officials.
One drawback with IntelliCell is that it won't perform well if the user is travelling at more than about 10 miles per hour, because the technology needs to get an accurate fix on the user's location.
"We have optimized the system for portability so you can carry it easily from point to point to connect but it's not for moving very fast because that would have been pointless" for the types of applications the network is aiming to service, ArrayComm's Saffari said.
In optimal conditions, i-Burst can support a zippy data transfer rate of 40M bps, ArrayComm said in a statement issued today. While results on busy networks are likely to be slower, the company says it will guarantee a connection speed of 1M bps even on a crowded network -- which would be fast enough for high-speed networked gaming, high-quality streaming audio and video, and good quality videoconferencing.
At 1M bps, the system would be significantly faster than today's wireless data systems, and, under most conditions, the technology would be faster than the 3-G (third-generation) wireless networks currently under development, ArrayComm officials said.
ArrayComm said IntelliCell has already been proven in commercial deployments serving more than 3.5 million customers worldwide, mainly in Asia.
With headquarters in San Jose, California, ArrayComm can be contacted at +1-408-428-9080, or on the Web at http://www.arraycomm.com/.
(Additional reporting by Marc Ferranti of IDG News Service.)