Unwired spreads its wings

Wireless broadband company Unwired Ltd is pre-paring to expand its network beyond Sydney after sealing a spectrum swap deal with regional pay tele-vision group Austar United Communications Ltd.

The agreement paves the way for the spread of wireless broadband services to homes in regional Australia as well as extending Unwired's reach to other major capital cities currently dominated by residential fixed line broadband provider Telstra Corp Ltd.

The deal was sealed as Communications Minister Helen Coonan announced the federal government had committed another $50 million to help con-nect more broadband services in regional Australia.

The government will now spend $160 million to expand the base of nearly one million regional sub-scribers and close the digital divide with urban areas.

Under the agreement between Unwired and Austar, the pair will trade portions of their spectrum licences and build separate broadband networks.

Unwired, which has more than 25,000 subscribers, will pay Austar $15.7 million for access to some of its 2.3 GHz spectrum licences and in return offer the pay TV operator part of its 3.5 GHz spectrum assets.

The deal also opens the way for the adoption in Australia of a mobile broadband standard called WiMAX, which operates on the two types of spectrum owned by Austar and Unwired and is expected to receive global certification this year. The pair have agreed that their separate but 'joined at the hip' networks will be WiMAX-standard compatible.