Cometa Networks, a joint venture between technology giant IBM, long-distance carrier AT&T and chipmaker Intel, plans to sell high-speed wireless Internet access -- also known as WiFi or 802.11 -- to telecommunications and cable companies who then can resell the service to stores, hotels and real estate firms who want to set up networks.
Cometa's wireless "hot spots" will begin appearing in 2003 in scores of locations in the 50 largest U.S. cities, said Cometa chief executive Lawrence Brilliant.
"Our task is to deploy the nation's largest and best 802.11 network," said Brilliant, the former head of broadband access company SoftNet Systems who stepped down in 2000 for health reasons.
WiFi uses radio waves to extend the Internet and company networks through the air for about 300 feet, with data transfers at speeds of up to 11 megabits per second, far faster than dial-up connections.
Access has popped up in cafes, airports and hotels. Some stores offer it free for their customers, others, like Starbucks, charge an access fee.
Cometa will join a growing field of companies offering WiFi networks, including Boingo Wireless, a California-based start-up; cellular carrier T-Mobile, which offers WiFi access in Starbucks coffee shops; and Verizon Communications, which announced it would set up wireless networks for businesses last month.
Verizon's initiative started in Boston and was expected to move to other cities.
Cometa's service will build on AT&T's existing network by adding some 20,000 wireless access points that will sit inside customers' businesses, Brilliant said in a conference call.
By 2004, the company hopes to place an access point within a five-minute walk of any city resident, or a five-minute drive of a suburb-dweller, Brilliant said.
Officials involved in the project declined to discuss financial terms, except to say the deal includes funding from venture capitalists Apax Partners and 3i, and that it is in talks with customers and additional partners. They also would not discuss retail prices of the service or whether it had landed any customers.
In addition to many offices, WiFi is already being used by courier companies and even some hospitals.
Analysts say pricing issues are among the main hurdles for companies selling WiFi access. Other tough issues include assuring the security of hotspots from crackers and those who try to use it without paying.
Home WiFi networking equipment that sells for around $200 has allowed homegrown networks to spread beyond the control of bandwidth providers like AT&T and Verizon. Some cable companies have asked customers to stop sharing WiFi Internet access, calling it theft of service.
Big phone companies in other countries, especially South Korea, the United Kingdom, Sweden and Japan, have been quicker to embrace WiFi and offer public hotspots, said C. Brian Grimm, spokesman for the WiFi Alliance, an organization that promotes the technology.
Cometa Networks will have offices in San Francisco and New York. The company's initial board of directors will consist of Brilliant, along with Ted Schell, general partner of Apax Partners; and Robin Murray, general partner at 3i.
AT&T plans to provide the venture's network infrastructure and management, with IBM handling wireless site installations and back-office systems.
The announcement said Cometa's service, which will support two WiFi formats -- 802.11b and 802.11a -- will allow users to keep existing sign-on procedures, e-mail addresses, IDs, passwords and payment methods, regardless of their method of access.
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