Milpitas firm capitalizes on new regulations

Aperto Networks poised to take advantage of federal rulings that allow access to an additional wireless frequency

BY DAVID SPEAKMAN

One Milpitas telecommunications-hardware company claims it’s poised to profit as the telephone company wars shift to wireless Internet services. With fewer than 100 employees, 3-year-old Aperto Networks expects two recent regulatory decisions will help it make a giant leap toward profitability.

In the past two weeks, while many were occupied by a possible war against Iraq or the latest exploits of the television show “Joe Millionaire,” two milestones shook the wireless broadband industry. The Federal Communications Commission (FCC) ruled that wireless, broadband Internet service providers could use the 5.8 gigahertz frequency and the Institute of Electrical and Electronics Engineers (IEEE) approved the 802.16a standard for fixed, wireless metropolitan-area network (MAN) technology, known as WirelessMAN.

The actions mean energy-efficient, wireless Internet, similar to the 802.11 Wi-Fi standard, is no longer limited to the workplace and home.

Internet service providers have the go-ahead to build towers for fixed, wireless networks that reach two to 30 miles. This creates a huge potential for companies, such as Aperto and Malibu Networks of El Dorado Hills, whose hardware both broadcasts and receives WirelessMAN signals.

“This could propel the whole industry forward,” says Aperto CEO Reza Ahy.

He predicts WirelessMAN could help digital subscriber line providers expand into competitors’ turf without paying toll fees to use the local telephone monopoly’s copper wires.

The new FCC ruling lets Aperto almost double the range of each of its broadband Internet towers to eight miles. The IEEE open standard should result in many chip manufacturers building chip sets that support 802.16a technology, a move that could drive down prices, Ahy says.

“The new IEEE 802.16a standard reshapes the broadband landscape,” says Roger Marks, chairman of the IEEE committee that ironed out the technical details for WirelessMAN. “It closes the first-mile gap, giving users an easily installable, wire-free method to access core networks for multimedia applications.”

Ahy believes the new technology can be easily adapted to the current one.

“Because the technology integrates well with IEEE 802.11 wireless LANs, IEEE 802.16a base stations are excellent candidates for wirelessly linking 802.11 [Wi-Fi] hotspots to the Internet,” he says.

“We believe an open standard will benefit all of us, the end-user in particular as economies of scale make wireless broadband more affordable,” Ahy says.

Ahy sees opportunity for profits in an approaching turf war among telecommunications giants, such as SBC, Verizon and Sprint, as they build nationwide, wireless, broadband networks and battle for market share.