Australian TV network Seven will invest A$50 million ($42 million) in building Australia’s first Wimax network in the city of Perth.
But plans for a nation-wide rollout have been scrapped in favor of this much less ambitious project.
In a surprise move, the network will built by a new Seven Network subsidiary, Vividwireless, and not wireless carrier Unwired, an existing subsidiary.
Seven abandoned a plan to build the network through Unwired because of high costs, The Australian said
. Unwired offers a data-only wireless service in Sydney and Melbourne based on the pre-Wimax SCDMA technology.
Nathan Burley, an analyst at research firm Ovum, said the decision to form Vividwireless may indicate that Seven plans to transform Unwired into a wholesale-only company, Burley added.
“Vividwireless has access to the largest allocation of 4G spectrum in metropolitan Australia, this will be focused on providing customers the best wireless broadband service in Australia,” Vividwireless chairman Ryan Stokes said.
the rollout will be overseen by Vividwireless' new CEO Martin Mercer, a former Telstra executive.
Vividwireless is promising average speeds of at least 4Mbps on the network, which is due to launch next March.
The company has selected Huawei as its network equipment supplier and will call on Unwired to manage the rollout.
Perth was selected as the site for the new network because the Western Australian capital is a rapidly growing market, but remains underserved by broadband infrastructure, Vividwireless said.
Burley said the Perth rollout could be a large-scale experiment to see if Vividwireless can compete in the larger markets of Sydney and Melbourne.
“However, it will have to make do without the advantages of leveraging established transmission towers, customer base, brand and distribution, which it would have in Sydney,” he said.