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September 18, 2007 10:28 pm

KDDI and Intel to bid for WiMax licence in Japan

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KDDI and Intel are leading a joint venture to bid for a WiMax licence in Japan and subsequently develop and operate a wireless broadband network based on the technology.

Japan’s second biggest mobile operator and the US technology group join JR East, Kyocera, Daiwa and the Bank of Tokyo-Mitsubishi in creating the company, called Wireless Broadband Planning.

WiMax, a high-speed wireless internet access standard, allows users with laptops or other media devices to download content at distances of up to 50 kilometres. It is a long-range version of WiFi, the present standard.

Wireless Broadband Planning will bid for the 2.5 gigahertz frequency band and, if successful, will launch a mobile wireless broadband business. The new company said it intended to become a global leader in WiMax and would offer services globally through roaming agreements.

In an effort to increase competition, the Japanese government has decreed that companies – such as mobile phone operators that already own a high-speed network – can own only up to a third of ventures applying for the new spectrum.

KDDI will have a 32 per cent stake in the new company and Intel 17.7 per cent. The company will be capitalised at Y850m ($7.3m).

If successful, the move is likely to provide a big revenue boost for Japan’s mobile phone operators, which are suffering from declining voice revenues and flat growth in data transmissions.

NTT DoCoMo, Japan’s leading mobile phone operator, has partnered ACCA Networks to seek a WiMax licence. The Japanese government is expected to hand out two licences by the end of the year.

Intel has been a leading force behind the spread of WiMax, with hopes that the spread of the technology will lead to a surge in devices embedded with WiMax chips.

Meanwhile, Sprint Nextel has said it expects to spend $5bn in building an expanded US nationwide network based on the WiMax technology standard.

It will launch the service commercially next April. Nokia, Samsung, Motorola and Intel all say they aim to embed WiMax technology in more than 50m consumer electronics products within the next three years.

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