"The biggest problem that a PowerTel or Magna Data is ever going to face is the fact that you have to buy last mile circuit from your largest competitor. As the incumbent monopolist, it is obviously in their best interest to make it as difficult as possible for you to succeed," Ashton says. "Moving away from Telstra meant no DSLAMs and no local loop."
There was also the appeal of being able to deliver a cutting-edge wireless network service in a market which Ashton says was crying out for such a service. "Being a wireless operator you can develop network infrastructure very quickly. It takes only three days to build a base station with a 10km radius, which works out at around 300 square km in coverage area," Ashton says.
At the end of 2001, Ashton and Choi wrote a business plan for what was to become BigAir Group, and started with their own seed money by building two base stations in the inner city Sydney suburb of Ultimo in May 2002. They obtained a carrier licence in October 2002, before launching commercial services, aimed principally at the business sector in broadband black holes where no ADSL or cable services are available.
Full launch
A full launch followed in March 2004, once BigAir had built out enough footprint, with six fully functional base stations. This was preceded by a considerable amount of R&D and testing.
"Wireless is not a simple technology. The challenges faced are far more complex than other types of broadband, where you can simply employ good Cisco engineers to build a network. There are very few people in Australia with wireless networking skills," Ashton says.
At launch, BigAir had just six staff, due, Ashton says, to the fact that it is not an employee-intensive network. By focusing on the business market, Ashton says BigAir could deal with IT managers that generally have a much higher level of understanding than the mums and dads market. "By dealing primarily with the business market, we have been able to dramatically reduce our service and support load. We also own our network end-to-end, without having to spend all day liaising with Telstra," Ashton says.
Since launch, BigAir has built its high-speed broadband network to cover roughly 50 percent of the Sydney metropolitan area, concentrating mainly on areas of highest business location density such as business parks. A further 50 percent of the uncovered area would be covered within a year, Ashton says.
Range of services
BigAir currently offers a range of highspeed fixed wireless broadband services, which has allowed it to compete with corporate frame relay services offered by the major telcos, at speeds of up to 100MB/s. It also offers a bundle of valueadded services including business-grade VoIP, and co-location services.
In addition, BigAir has an agreement in place with fellow wireless provider Commander through its iBurst roaming service, which uses a card plugged into a laptop and gives the user internet access over most of Sydney.
BigAir also recently completed the acquisition of mobile and portable wireless service provider Veritel Wireless, to complement its fixed wireless service. Veritel currently services more than 4000 business and residential customers using its wholesale network partners, iBurst and Unwired.
Ashton says the acquisition of Veritel had allowed BigAir to provide a comprehensive range of wireless broadband services to the business market.
"Along with our existing voice and data services, which we offer over our own fixed wireless network, we can now also offer mobile and portable wireless broadband services for laptop users when roaming outside the office. We intend to bundle these services and cross-sell them across our expanded customer base."
ASX listing and channel program
BigAir also plans an IPO later this year, which Ashton says would provide funding to expand the business into other metropolitan markets. This would likely involve a network build out in Canberra initially, followed by Melbourne and Brisbane, he says.
"What we want to do is greatly extend the coverage of our network and also increase the sales and marketing activity for all of our wireless broadband services," he says.
BigAir is planning to list on the ASX on 8 December. Its market capitalisation at the offer price of 25 cents per share will be $23.5 million.
Ashton says the company also planned to launch a channel program after the ASX listing, which will include the appointment of a channel manager. "We haven’t got a very well developed system at the moment. We also have a very under-utilised network and are looking to work with suitable partners, be they system integrators, network integrators or others with good existing customer relationships, to provide high-quality communications packages and integration work on anything from PSTN to full VoIP systems," he says.
Bright future
As far as Ashton is concerned, wireless internet services are set to undergo an explosion in uptake similar to that experienced by mobile phone services in the 1990s. "Right now we are roughly at the same stage that the mobile phone industry was at in the mid-to-late 1980s," Ashton says. He adds that, at that time, the handsets were unwieldy and the networks unreliable, but the phones got smaller, digital was introduced and the services became more affordable. Now mobile subscriptions outweigh those of fixed line.
Wireless broadband, he claims, is headed down the same path. "Wireless will be the preferred form of broadband internet access within 10 years," he says. "If it gives you the same level of performance as ADSL or cable and you can take it with you without inconvenience, why wouldn’t you want to take up a wireless service?"
Looking back over his career to date, Ashton says he had derived a great deal of satisfaction from watching his businesses come to life, "especially when you know its your own network you have built from the ground up".
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