Vividwireless close to securing funding for capital city WiMAX networks - UPDATED

Stuart Corner
Tuesday, 03 May 2011 15:16

vividwireless has extended its mobile WiMAX network to areas around the Australian National University and universities of Queensland and Adelaide and says it is in discussions with a short list of potential investors to fund large scale rollouts in these cities and in Melbourne and Sydney.

The network was launched in Perth in March 2010 with extensive coverage and later in 2010 coverage around universities in Melbourne and Sydney was provided. Vividwireless has now expanded its network to cover areas within five kilometres of universities in Canberra (Australian National University); Brisbane (University of Queensland); and Adelaide (University of Adelaide).

The company has plans to cover large areas of the mainland state capitals, but is still struggling to lock in the funding needed. At a briefing on the company's LTE trials in February, in response to a question about funding, CEO Martin Mercer said: "If you had asked me six months ago I would have said we would have it by now'¦It is well advanced. We are in discussions with a number of operators in the region and they are showing a lot of interest." He told iTWire today that "we are down to a short list of investors."

(The original version of this story quoted Mercer saying that annnouncement of investor(s) was imminent. This was not correct).

However, he declined to put any timeframe on when these negotiations might conclude. He also declined to give any indication of the amount sought, but referred to what he had said at the LTE briefing; that an estimate of costs could be made my extrapolating from the published cost of the Perth network. "In Perth we built 145 towers for a total capital cost of $54m and one third of that was cash flow costs until we became cash flow positive."

However the company has not released any customer numbers. Mercer, today, would tell iTWire only that: "the number of users per base station in Sydney and Melbourne is not far behind Perth, notwithstanding the lack of marketing support."

Because of the limited coverage in these cities the company has done little above the line marketing. Its CPE, however, is available in Dick Smith and Harvey Norman stores within and close to its coverage areas.