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The Honolulu Advertiser

Posted on: Wednesday, June 1, 2005

Wireless Internet provider 'in town'

By Sean Hao
Advertiser Staff Writer

Honolulu consumers may soon have a third major option for high-speed Internet service — and it won't require any wires.

Comparing ISP options


• Speed: Up to 1.5 megabits per second

• Cost: $29.99 a month

• Delivery system: Wireless (modem must be plugged into electric outlet)

Oceanic Road Runner

• Speed: Up to 5 megabits per second

• Cost: $45.95

• Delivery system: Cable modem

Hawaiian Telcom DSL

Speed: 3 megabits per second

Cost: $37.95

Delivery system: Phone line

*Based on service in other cities.

Clearwire Corp., a company founded by mobile phone pioneer Craig McCaw, could soon offer wireless Internet service on O'ahu, joining Hawaiian Telcom and Oceanic Time Warner Cable as a major provider of broadband service to homes.

Kirkland, Wash.-based Clearwire yesterday said it wouldn't comment on future plans for competitive reasons. However, the company already is recruiting for jobs in Hawai'i via its Internet site and at last week's WorkForce 2005 Job Fair at the Neal Blaisdell Center. Clearwire also has federal communications licenses required to operate in Hawai'i, which are owned by subsidiary Fixed Wireless Holdings LLC.

"We've announced that we're entering 20-plus markets by the end of this year and we haven't backed off that," said Clearwire spokesman Todd Wolfenbarger. "Obviously the back half of this year there's going to be a lot of stuff coming on board."

Launched last year, Clearwire has raised $300 million and now is operating in Abilene, Texas; Daytona Beach and Jacksonville, Fla.; Medford, Ore.; and St. Cloud, Minn. While Clearwire's service is wireless, and portable, it's mainly designed for use in a stationary setting such as a home. And because the service is similar to cellular-technology it should be available across a broader area than wireless Internet connections using so called Wi-Fi technology.

A ready market

Honolulu could be an attractive market for Clearwire. Fifty-two percent of Internet users in Honolulu have broadband connections, which was the highest percentage among 75 major metropolitan areas in a survey released by Scarborough Research in February. An estimated 316,380 people in Honolulu access the Internet via broadband connections instead of cheaper dial-up connections, compared with a national average of 33 percent.

For local broadband users Clearwire's entry would mean more choices and possibly lower prices.

"I would be willing to entertain the thought of switching — especially if it's cheaper," said Janice Sanders, a Hawaiian Telcom DSL subscriber in Waikiki.

Clearwire customers in other markets access the Internet via a modem that plugs into an electrical outlet and a computer. Download speeds range from 512 kilobits per second to 1.5 megabits per second — or 1.5 million bits of information per second. That's slower than Oceanic Road Runner's maximum speed of 5 megabits per second, and Hawaiian Telcom's digital subscriber line speed of 3 megabits per second, but remains far faster than traditional dial-up Internet connections.

Wolfenbarger would not specify what rates Clearwire might charge in any new markets. Currently Clearwire's service is offered at a starting price of $29.99, which is lower than the regular rates of the offerings from Oceanic and Hawaiian Telcom. Bundled with other services Road Runner's lowest price is $34.95 a month, while Hawaiian Telcom's DSL is as low as $29.95 a month with an annual contract or in a bundle of services.

Several potential Clearwire competitors in Honolulu are aware of the company's intentions to begin offering wireless Internet service.

"We know about them," said Alan Pollock, vice president of marketing for Oceanic. "They're certainly a player."

Similarly, Hawaiian Telcom said it's aware of Clearwire's plans to enter the Hawai'i market.

"We believe consumers will benefit from all the broadband choices available and select the provider that best meets their needs and price points," said Ann Nishida.

Putting up antennas

While Clearwire would not confirm its plans to begin selling the service in Honolulu, the company's Web site at www.clearwire.com listed 15 openings in Honolulu and one on Maui yesterday.

"Most people know that they're here and they're doing things" such as putting up antennas, said Joshua Beil, co-founder of Skywave Broadband, which provides wireless broadband Internet service in Honolulu, Waikiki and Hawai'i Kai. "They're definitely in town.

"From a customer standpoint it's a great thing. They get more choices," Beil said.

Oceanic's Pollock agreed that another competitor for high-speed Internet services is good for consumers, but will force competitors to remain nimble.

"We have to constantly be vigilant because (with) consumers now, there's not a lot of brand loyalty," Pollock said. "If somebody can come up with something a little bit better and a little bit cheaper, they'll go to it."

Reach Sean Hao at shao@honoluluadvertiser.com or 525-8093.