Utopian Wireless garners RUS funds to support WiMAX build

The federal government’s plan to help fund deployment of broadband services in rural communities is beginning to see some results in the mobile space as this week Utopian Wireless Corp. said it was awarded $4 million in funding, bringing its total funding to date to nearly $12 million. The company said the funds are earmarked for 14 projects in eight states.
Bethesda, Md.-based Utopian said it plans to use the money, which consists of 75% in grants and 25% in long-term loans, to deploy a WiMAX-based network using the company’s 2.5 GHz spectrum holdings. The company holds spectrum licenses covering 1,400 communities in 24 states.
The funding is part of the U.S. Department of Agriculture’s Rural Utilities Service Broadband Initiative Program. The government noted last year that it had received nearly 2,200 applications totaling $28 billion in broadband stimulus requests.
WiMAX model
Utopian Wireless’ CEO Rudy Geist said in an interview with RCR Wireless News that the company expects to begin launching its WiMAX-based services in 12 to 18 months. Geist, a former executive at Clearwire Holdings Inc. before it was bought by wireless industry pioneer Craig McCaw in 2003, noted the importance of the government funding in allowing Utopian Wireless to move forward with its deployment plans.
“The funding is extremely important for us and the communities that will benefit,” Geist explained. “The process was extremely detailed oriented and we are glad the government saw the potential of our application and the sustainability of our model and elected to fund us.”
Geist noted that Clearwire’s success is a model for Utopian Wireless, though on a smaller scale, and that the use of WiMAX for its initial plans will provide the carrier with every chance to succeed. Geist added that Utopian Wireless has in excess of 45 megahertz of spectrum in many of its markets that will allow it to deploy a network similar to Clearwire.
“These markets utilizing current technologies are very attractive from an investment standpoint to deploy,” Geist explained. “The technology has been developed around the Clearwire model, and has been in development for many years. These are the most highly efficient and high capacity wireless networks ever built at the absolute least cost in history.”
While Utopian Wireless has not named an infrastructure partner for its network build, Geist said that like Clearwire has recently announced it would expect the equipment it deploys to be upgradeable to future “4G” technologies, including LTE. Clearwire has said it plans to begin trialing LTE technology in its Phoenix market, though it has not committed to commercially deploy the technology.
“We are technology agnostic,” Geist explained. “One of the requirements for the equipment is that it can be upgradeable to new technology. All vendors for 2.5 spectrum are developing a chassis that is software upgradeable.”
Utopian Wireless is also following in Clearwire’s model by relying almost exclusively on microwave technology for its backhaul needs. This is expected to provide the needed capacity to handle high-speed wireless data services as well as reduce dependence on incumbent telecom providers for backhaul services.
Rural competition
Also like Clearwire, Geist said Utopian Wireless was looking to wholesale access to its network for those companies interested in providing a mobile data offering.
“We have talked to a large number of telecom companies in our markets,” Geist said. “As we are developing our channel program and wholesale program I think we will have to take into consideration providing access to our network.”
Geist noted that while the initial deployment would be focused on providing data services to consumers, the company was also looking at a Voice over Internet Protocol solution to provide voice services.
While Utopian Wireless is expected to have a head start in providing high-speed mobile broadband services to many rural markets, the company is aware that that lead will not last forever. Verizon Wireless has said it plans to aggressively build out its LTE-based network, including announcing a desire to partner with rural operators to help achieve its planned nationwide coverage by 2015.
“Verizon is a very large company with a lot of money,” Geist noted. “We hope they don’t want to focus that on markets that in the past they have not had any interest in.”