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Wireless Microwave Internet Access Coming Soon
Boston Globe, Dec 2, 1999

Microwaves, best known for their use in the kitchen, are poised to become the latest wireless technology for beaming Internet and phone service into homes and small businesses. In a briefing for reporters yesterday, Cisco Systems Inc. of San Jose outlined what it says will be the next generation in Internet and phone access, which it will debut next year. Using low-frequency microwaves, Cisco executives say their equipment can deliver high-speed Internet connection, teleconferencing, or telephone service - without wires or cables. All that is needed by the user is a special antenna and a box the size of a large notebook with multiple jacks to plug in computers and phones. The services would be transmitted via base stations installed throughout a city or neighborhood.

Such access offers several advantages over current options, such as cable modems, telephone dial-up access, or digital subscriber lines, or DSL, analysts say. It moves consumers away from cumbersome wires, and it's less expensive to install than cable or fiber. "It's cheap, and it's fast," said Howard Anderson, chairman of the Yankee Group in Boston. "I don't have to dig up your street to lay down cables. All I need are a couple of transmission towers. That's why this technology is being used." In addition, wireless broadband access has two to 10 times the range of DSL, which can only be installed within three or so miles of a central station. With wireless broadband frequencies, service can be provided as far as away as 30 miles if the line of sight between the user's antenna and the base station is unobstructed.

If obstructed by objects such as trees or buildings, the range drops to six miles, according to Greg Raleigh, a director of engineering at Cisco, and the scientist who helped develop the technology through a company called Clarity Wireless of Belmont, Calif. Cisco purchased Clarity in 1998 for $157 million. Because of its reach, broadband wireless technology can beam high-speed connections via microwave bands to places where wires would be difficult or uneconomical to install, such as across rivers or canyons. That potentially opens the Internet gates to millions of new users, said Donald Listwin, executive vice president of Cisco. As of July, 37.4 percent of the US population had Internet access, according to Nielsen Net Ratings, leaving more than 160 million Americans who have yet to sign up for Internet access. Of those who have Internet access, few have high-speed "live" connections that are always on, like telephone dial tones. That leaves the vast majority of Americans as potential subscribers to Cisco's nimbler wireless alternative. "Wireless is hot this year," said Chris Stix, managing director of SG Cowen Securities Corp. in Boston.

Cisco, generally known as an supplier of Internet equipment, will not be in the business of selling Internet or phone access. Instead, starting next week, Cisco will sell the technology to companies that want to provide the service, from large telecommunications firms to niche entrepreneurs. Because the use of these microwave bands does not currently require licenses from the Federal Communications Commission, small companies can more easily jump into the business of providing Internet access by simply purchasing and installing Cisco equipment, which starts at $150,000 for a base unit that can support up to 3,000 simultaneous, active Net users. Though it has yet to receive orders for its new product, Cisco is predicting it will sell more than $3 billion in wireless equipment next year. Though that amount is just a fraction of Cisco's annual revenue of $12.2 billion in fiscal 1999, sales of its broadband wireless equipment are expected to grow rapidly, topping $7 billion in 2003, said Steve Smith, a director of marketing for Cisco.