Flarion VC Touts Carrier Trial

A major carrier is likely to announce plans to use Flarion Technologies' Flash-OFDM equipment for high-speed wireless data services before the end of the year, says a source close to the company.

As Nextel Communications Inc. (Nasdaq: NXTL) is already testing Flarion's equipment (see Nextel Trials Flarion's Flash), it would seem to be the most obvious candidate for actual deployment. However, neither company will comment on the prospects of a deal before the end of the year.

"We have no formal agreement with Flarion," a Nextel spokesperson told Unstrung. "When we do have a formal agreement, we go out with it." Flarion is even more tight-lipped about the prospects for a deal. "I cannot even comment on that," says Ronny Haraldsvik, senior director of marketing strategy at the company.

However, Bruce Sachs, a partner at Charles River Ventures, the VC firm that is backing Flarion, says that it will have a deal with a major carrier before the end of the year and more field trials with others.

Flarion is currently running its trial with Nextel; it has six Flash-OFDM base stations dotted around the operator's headquarters in Reston, Virginia. The system is delivering data at 1.4 Mbit/s over 1.25MHz, at a range of up to four miles.

Siemens AG (NYSE: SI; Frankfurt: SIE) has supplied Web pad tablet PCs for the trial. Sony Corp. has pitched in with interactive gaming systems, laptops, and personnel, while Cisco Systems Inc. (Nasdaq: CSCO) has been "helpful" with 7200 routers and VPN clients. The company formerly known as Compaq Computer Corp. supplied iPaq handheld computers and servers.

Another Flarion partner, IBM Corp. (NYSE: IBM) has been working with the company "to look at what it would take to integrate disparate networks," says Haraldsvik. This, of course, is crucial if carriers plan to run the Flarion technology alongside their existing networks.

The company's Flash-OFDM (Orthogonal Frequency Division Multiplexing) technology uses a digital modulation technique that splits the signal into several different strands at different frequencies. Flarion has implemented its own version of OFDM in its RadioRouter base station, which overlays existing cell sites and spectrum and provides a routing interface to existing IP networks.

Flarion says its technology is approximately four or five times more spectrally efficient than comparable 3G technologies, such as CDMA2000 or UMTS. It also claims it's cheaper to implement.

The cost benefits could be a crucial factor for Nextel, which has not yet announced an upgrade path from its iDEN system to a third-generation system. Flash-OFDM may provide a way for the operator to add high-speed data services without the pain of upgrading to 3G.

Flarion is also looking beyond the domestic U.S. market: Haraldsvik says the company has seen interest from operators in Korea and Europe.

— Dan Jones, Senior Editor, Unstrung
http://www.unstrung.com