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what do you mean by "wi fi ready as well" ? WiMAX , 802.11a,b,g or what ?


http://www.hollywoodreporter.com/thr/columns/mermigas.jsp
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July 18, 2006

News Corp., DirecTV take broadband to the Max

By Diane Mermigas

CHICAGO -- News Corp.'s zealous embrace of interactivity soon will reach way beyond the runaway success of the social networking Web site MySpace when its majority-owned DirecTV decides on a path and partners for creating a national WiMax network.

Approval is imminent for the project that could take at least two years and $2 billion, providing News Corp. and DirecTV a valuable wireless interactive broadband loop with consumers to directly sell content, advertising, goods and services. WiMax is a wireless a broadband technology often referred to as "WiFi on steroids" with a much wider 30-mile range than the more limited access offered by WiFi services. WiMax, which is short for World Interoperability for Microwave Access, also promises to provide more security and speed than traditional wireless connections.

"If we can pull something off ... there is no reason why that shouldn't link in with everything," News Corp. chairman and CEO Rupert Murdoch said in a recent interview. "I would expect to have wireless broadband advanced in at least two or three cities before the end of this year, and then it might take two or three years to build it out across the entire country," Murdoch said.

High-level sources say the unprecedented undertaking will involve strategic equity partners that bring WiMax spectrum, equipment and other expertise to the mix. In one of the most likely scenarios, News Corp. and DirecTV have been in advanced talks with Clearwire Corp., a WiMax venture of Craig McCaw, in which chipmaker Intel Corp. and equipment manufacturer Motorola Inc. recently invested $900 million.

McCaw has been amassing one of the largest stables of licensed radio spectrum to build his own national wireless WiMax network. Intel, which has a vested interest in the commercial success of WiMax, particularly for PC users, has been one of Clearwire's partners from the start.

As an alternative, DirecTV also has been exploring the possibility of partnering with other WiMax spectrum owners such as Mobile Satellite Ventures (MSV) or acquiring its own WiMax spectrum when such rights are auctioned off by the FCC on Aug. 9. In such cases, DirecTV would have to pull together, on its own, more of the elements needed to build its own WiMax network.

Clearwire, such leading cable operators and DirecTV rivals as Comcast and Time Warner and telcos like Sprint Nextel also are among the more than 250 companies that have filed with the federal government to bid in the auction of wireless spectrum.

Some sources say that EchoStar could join DirecTV in providing a united domestic satellite-backed WiMax alternative to cable and to telephone competitors such as Verizon, Cingular and Sprint Nextel. Sprint Nextel is working with a consortium of cable operators including Comcast and Time Warner to assist them with a much-needed wireless out-of-home extension.

The first fruits of that effort are expected this year or early in 2007, though skeptics say cable's preoccupation with the voice-over Internet Protocol addition to their service bundle and Sprint Nextel's preoccupation with its post-merger integration will likely make that a tepid event. While telephone companies continue to build out costly fiber-optic systems to homes to replicate cable's expensive digital broadband connections there, increasing amounts of content and commerce are moving to devices and platforms outside of the home.

It is that powerful, anywhere-anytime wireless connection that News Corp. aims to maintain with the core younger consumers of MySpace and its TV channels. In the process, News and DirecTV could leap ahead of many broadband distributors.

The construction of a national WiMax network would be another crowning achievement for Murdoch; Peter Chernin, News Corp.'s longtime president and chief operating officer; and Chase Carey, DirecTV president and CEO, and formerly News Corp. co-CEO. The well-regarded Carey will execute the ambitious WiMax project that will enable the dominant satellite provider, in which News Corp. has a 35% stake, to compete against cable and telephone rivals with a more interactive bundled offering.

"There are a number of options we're considering that could involve partnering with any number of equipment or technology companies. But I'm not going to handicap the players," Carey said in a recent interview. Carey has told analysts he prefers not to tap more than about $1 billion of DirecTV's $4 billion in cash reserves.

"There are a lot of moving parts, and when we have the right deal on the table, we'll do it. But in the short term, we will continue to provide our broadband services through the telcos," Carey said.

Sources say one of those moving parts could be closer ties with DirecTV's only domestic rival, EchoStar Communications, whose controlling chairman and CEO Charlie Ergen could consider selling as satellite's growth curve and ability to siphon subscribers from cable has plateaued. The lack of interactivity in the satellite-TV business model to compete with broadband data and wireless communications makes growth even more difficult.

A merger of the only major satellite players in the U.S. may not be as readily dismissed as it once was by federal regulators, given the increase in many areas of competition for service to the home and to consumers in general. News Corp. and DirecTV officials concede an argument -- and maybe even a deal -- can be made for merging with EchoStar, the notion for which could be advanced by any cooperative WiMax alliance.

Having its own interactive pathway to consumers in the U.S. would put News Corp. in an elite class of major content providers that also own their own broadband platform that now includes only Time Warner, which boasts the Time Warner Cable pipes and a wealth of production, distribution and archive assets.

While WiMax is not considered an ultimate distribution panacea, there are many enterprising ways in which such companies as DirecTV and News Corp. would use the interactive network to provide unique branded content, commerce and services directly to lucrative out-of-home platforms that include iPod-like video players, cell phones, PDAs, personal media players, cars and next-generation mobile devices.

That would put News Corp. on the front lines of creating the next forms of social networking, peer-to-peer sharing and new content forms. It also would give News Corp. the means to maximize its multibillion dollar investment in DirecTV while positioning the satellite provider to become a more dominant broadband player.

Having access to or owning its own domestic WiMax network through DirecTV also would strengthen links between News Corp.'s domestic media units and its global satellite operations -- including its 37% interest in BSkyB in the U.K. and its wholly owned StarTV in Asia and Sky Italia -- at a time when Fox-branded film and television content are helping to fuel growth markets like China and India.

That, in turn, would bolster McCaw's global WiMax expansion efforts in parts of the world such as Asia, India and Africa where WiMax can be quickly and inexpensively embraced in lieu of constructing expensive broadband infrastructure. Sources say Clearwire could provide a national WiMax network connection for as little as a $25 monthly fee, or less than half that of some existing wireless broadband services.

WiMax, which is short for World Interoperability for Microwave Access, also promises to provide more security and speed. McCaw, a cellular pioneer who sold his former company to AT&T a decade ago, has looked to Intel and Motorola to more than doubled the financial resources he planned to raised from going public with Clearwire, which he launched in 2003. That nearly $1 billion in funding is enough to deploy WiMax in several U.S. cities. Clearwire already provides WiMax service to several hundred cities in the U.S., Mexico, Ireland, Belgium and Denmark.

Financial, subscriber, content and other resources from DirecTV and News Corp. would be another huge plus for McCaw, whose Clearwire remains unprofitable and has only about 18,000 domestic subscribers. However, Clearwire's licenses eventually allow it to deploy fixed and portable WiMax services to as many as 90 million consumers in the U.S. That is the potential DirecTV and News would like to tap.

Such a WiMax venture would be indicative of the genius News Corp. and Murdoch have consistently demonstrated in responding to and using new technology to advance its content businesses. Rather than resisting the radical shift to consumer-controlled media, News Corp. is taking its cues and making its moves.

Virtually every segment of the media and entertainment industries is being reshaped by digital broadband interactivity, and the transfer of content, communications and commerce to and from mobile devices. Broadband households will more than double to 433 million, feeding the global market for mobile wireless devices. Digital and mobile content will account for 41% of the total growth through 2010 in online rental subscriptions and digital streaming in filmed entertainment, licensed digital downloads and mobile music, online and wireless video games, electronic books, and online casino gaming, according to PriceWaterhouseCoopers.

News Corp. wants to makes certain its television, film, game, news and social networking content get its share of the action. As the owner of the largest TV station group, as well as some of the most successful broadcast and cable program networks, News Corp. realizes it must secure its own digital broadband path to consumers as a means of bridging them all.

Such a WiMax venture would be indicative of the genius that Murdoch and News Corp. have consistently demonstrated in responding to and using new technology to advance its content businesses. Rather than resisting the radical shift to consumer-controlled digital media, News Corp. is taking its cues and making its moves.

WiMax isn't expected to have a major competitive impact for several years, or the time that it takes to install the necessary standardized towers and receiver boxes. Its adoption also will be facilitated by the availability of a WiMax card for installation in portable personal computers, which will be delivered later this year by Intel, which also will build in interchangeable WiMax and Wi-Fi technology onto its Centrino laptop chips.

"WiMax will indeed have a big global impact on consumers, enterprises, vendors and telecom operators by making high-speed wireless access cheap and mobile, but not until 2010 or later," Forrester analyst Charles Golvin said in a report. "WiMax is a very promising global standard in search of a killer application."

It would not be too surprising if News Corp. and DirecTV figure out a way to get there first.