National DSL provider Speakeasy adds Seattle broadband wireless test area to mix: Speakeasy offers DSL, T1, and dial-up nationwide through local points of presence and relationships with Covad and regional telephone companies. They rolled out Voice over IP telephony to their DSL customers recently promising that their network is optimized for voice performance.

Now, it's time for broadband wireless. In August, Speakeasy revealed an undisclosed sum was invested by Intel, which is betting on the future of WiMax, a yet-to-be-finalized certified form of wireless broadband that will have a high degree of interoperability and is tuned for delivery. (For a cogent explanation of these abilities in WiMax, download and read the first white paper on this page, ISPCON 2004 keynote, by Nigel Ballard of Matrix Networks and Personal Telco in Portland.)

Speakeasy's first rollout is in their (and my) background, in the area around their downtown Seattle offices. This makes it easier to check on performance, no doubt. The promised speed is 3 Mbps symmetrical with optimization for voice packets to have priority. The focus is business broadband, which is a great market to start on. The equivalent in T-1 lines (two 1.544 Mbps circuits) would cost nearly $1,500 per month; Speakeasy hasn't posted pricing, but Om Malik spoke with Speakeasy CEO Bruce Chatterley who says a T-1 equivalent will be $300 per month, and a 3 Mbps service will be $600 to $700 per month. Installation time will be 24 to 48 hours. Malik says that Chatterley cites T-1 installation at 18 to 20 days.

I had a chance to catch Chatterley this afternoon by phone at the Wireless Connectivity Americas conference (WiCon). Chatterley said that the pricing Malik cited are rough estimates for their ultimate fees. "The objective of the trial is to really confirm that pricing, both from a cost structure standpoint and from an end-user demand standpoint," he said. He noted that 30 percent of customers who try to get service from Speakeasy cannot, and "the first reason we're doing WiMax is to start to address that demand that we can't serve today, which is just a huge opportunity."

Chatterley also said that Speakeasy found that there's a large gap between T1 at 1.5 Mbps and higher-bandwidth offerings. They can sell T-1 for about $700 per month for unlimited bandwidth, but if you want 2 or 3 Mbps, you have to resort to technical tricks like bonding multiple T1 lines, and the costs start to mount. Moving to a T-3 or OC3 equipment starts well above $10,000 even for fractions of its full 48 Mbps capability. Business customers are going to be very excited about 3 Mbps broadband with a service level agreement as part of the contract.

The emerging regulatory framework is another reason Chatterley cited for testing broadband wireless, which will likely remain under a lighter burden for some time to come. Speakeasy's primary business is broadband over DSL. The FCC has gone back and forth on certain issues, like line sharing. Chatterley said, "This is a good hedge. You never know who is going to be in office. You never know what kind of dynamics are going to be at the FCC." Even if Speakeasy loses access little by little to their last-mile providers, Chatterley said, they can move forward on this service, which he estimates would add just 10 percent to their infrastructure costs of offering a point of presence.

Chatterley is very bullish on mobile WiMax, which he puts out at 2007 or later, noting that there's a neat dovetail between cellular and mobile broadband. He expects his customers who adopt the Speakeasy VoIP offering will be able to take voice and high-speed data as they travel around Speakeasy's coverage area, turning to cellular networks as needed. He's the first CEO I've heard talk about cell data, cell voice, VoIP, and WiMax as all complementing each other, and it's a more compelling combination than expecting cellular to shrivel up and die--who would install WiMax on every highway and in rural areas?--or believing that 3G will eat WiMax's mobile lunch.

I'll take Speakeasy to task for using WiMax generically. The press release says, WiMax is an industry standard for wireless communications. Not yet, it isn't: maybe next year. In the meantime, Malik notes that Chatterley told him that the gear is pre-WiMax, which probably makes it Alvarion or Proxim's pre-WiMax system. [link via GigaOm]