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UNWIRED SECURES WiMAX SPECTRUM |
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Written by Adam Gosling
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Saturday, 09 July 2005 |
Austar and Unwired have done a deal to help them each cover regional Australia by doing a trade on spectrum they each licence.
AUSTAR plans to give a portion of its 2.3GHz spectrum licences to Unwired which will reciprocate by handing over a portion of its 3.5GHz spectrum licences to AUSTAR.
The deal isn’t a straight swap though. Unwired turned to Allco Finance for a $15.7million loan to finance the swap.
But the deal gives Unwired both 2.3GHz and 3.5GHz licences for the majority of metropolitan Australia. It nees this to implement its planned roll out of WiMAX.
AUSTAR CEO John Porter said, “Our arrangement with Unwired is great news for the future of broadband services in regional Australia. By rationalising our spectrum holdings into our regional markets, AUSTAR will be in a position to develop plans to launch a broadband service, which is a logical extension of our core business.
“We have spent the last 10 years building a business that specialises in dealing with regional Australian needs, from our television service to mobile and dial-up internet services. Wireless broadband is ideally suited to regional markets, and we want to build on our well established brand and operational capabilities to serve our regional customers.”
Unwired Chairman Peter Shore said, “The beauty of building WiMAX-compliant networks is interoperability. As the networks are rolled out, Unwired would be able to sell a national service to all regions where AUSTAR builds its network, in addition to its own city network and services, enabling Unwired wireless broadband customers to roam seamlessly from city to country and vice versa.
The WiMAX-enabled 2.3GHz and 3.5GHz spectrum licences will allow Unwired to focus on the introduction of wireless broadband into the capital cities and major metropolitan centres, including Sydney, Newcastle, Melbourne, Geelong, Canberra, Brisbane, Adelaide and Perth.
Unwired CEO David Spence said, “This funding gives us the flexibility to own the spectrum we need in the areas of most interest to us in our build out. Instead of spending $50million to acquire the 2.3GHz spectrum nationally, with the spectrum swap we are able to concentrate on the centres of population to build the scale of business we want for only $15million, thereby decreasing our future funding needs for roll-out in other metropolitan markets. It also removes the current $3million p.a. 2.3GHz spectrum lease cost we are incurring. This loan is repayable at any time at Unwired’s discretion without penalty. We have chosen a debt funding facility as we think it is an attractive option at this stage and is in the best interests of Unwired’s shareholders.”
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