Pipex, Intel Capital tie up to offer WiMAX service in Britain |
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Mon, 03 Apr 2006 12:50
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LONDON: British telecoms company Pipex Communications Plc. is teaming up with Intel Capital, Intel Corp.'s venture capital investment arm, to develop a wireless broadband internet access network for the country's largest cities.
The new venture, Pipex Wireless, will use the WiMAX mobile internet access technology standard. It will be managed by Pipex executive chairman Peter Dubens and Pipex's entire 3.6GHz UK spectrum licence will be transferred to it.
Intel Capital is to bring in $25 million into the venture and Pipex intends to build a WiMAX network that will spread across the whole of the country.
Pipex said the new network would become functional in London and Manchester in 2007 and will be available in eight other major cities by 2008.
Pipex, which provides broadband, internet hosting and network services, is one of the two companies in Britain to hold a national licence for WiMAX technology -- wireless broadband which can be transmitted over a number of kilometres. The other is UK Broadband, owned by PCCW Ltd.
The announcement of the tie-up coincided with Pipex declaring its financial results for 2005. The company reported a 30 per cent increase in turnover to 133 million pounds, while pretax profits rose to 7.1 million pounds, up from 6.2 million pounds in 2004.
The company had acquired the Homecall fixed line business of Phones4U for 43 million pounds in March. The company's customer base rose 35 per cent to 575,000 during 2005, which included 283,000 broadband and 290,000 website hosting subscribers.
Arvind Sodhani, Intel Capital's president, said “WiMAX technology improves the economics of broadband access by lowering costs and providing exciting new service models for customers. This investment is part of Intel Capital’s continued effort to deploy broadband access globally using competitive WiMAX-based technology products.”
Dubens said with a wireless service, Pipex Wireless will offer broadband access and services "complementary to Pipex’s existing business of DSL access, hosting and network access."
Pipex shares were up 5 per cent in early trading at 16-1/4 pence, valuing the company at around 382 million pounds.
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