BT plans wireless service despite ban

British telephone company British Telecommunications said Wednesday that it plans to launch the nation's first commercial Wi-Fi network in June, despite a ban on such businesses in the United Kingdom.

The carrier is trying to follow the lead of U.S. carriers that have already added wireless Internet access into their mix of offerings. These wireless networks can download Web pages at speeds much quicker than a digital subscriber line (DSL). But their drawbacks include a range of less than 300 feet and notoriously porous security. Despite that, Wi-Fi networks have grown in popularity, finding a place in millions of businesses and homes worldwide.

VoiceStream Wireless sells Internet access based on Wi-Fi, otherwise known as 802.11b, at about 600 Starbucks throughout the United States. Nextel Communications said it intends to add Wi-Fi to its stable of offerings, and Sprint is an investor in Boingo, a commercial Wi-Fi service.

Cities have also taken notice of Wi-Fi's popularity. Palo Alto, Calif., and Jacksonville, Fla., have installed outdoor wireless networks in certain areas of their cities and are letting people use them for free.

In the United Kingdom, there is a ban on the commercial use of the 2.4GHz bandwidth, where Wi-Fi networks broadcast their signals. BT director of mobility David Hughes said the company has received "indications" that the ban should be lifted by June.

In March, a government-commissioned review of radio spectrum management recommended a more liberal approach to the 2.4GHz and 5GHz bands. "The current constraint on the use of license-exempt bands for the provision of public access communications services should be removed as soon as possible," advises the report, which was prepared by a team led by professor Martin Cave of Brunel University.

British carriers are interested in Wi-Fi partly because there are already 300,000 Wi-Fi users in the country, many in homes. They also need to find new sources of cash.

Gartner analysts Ian Keene, Neil Rickard and Nigel Deighton say BT Group has a good opportunity in the wireless LAN market, but it will take time to develop. see commentary

BT and other European carriers are feeling financial strain from spending billions of dollars on licenses to sell so-called "3G" wireless phone services. Many carriers have delayed their cellular telephone network plans as well.

"There are a lot more (Wi-Fi) equipped people than those 3G equipped," Hughes said. "We think it's a really important technology, not least because we reckon there are 5.3 million users and 300,000 in the U.K."

BT will start using 20 of its Wi-Fi networks in June pending the ban being lifted. Hughes said BT intends to have 400 wireless sites up and running within 12 months, and could have 4,000 sites by the middle of 2005.

BT also hopes to upgrade in the next few months to a new wireless network standard called 802.11a, which is capable of shuttling Internet access at about four times the speed of what BT will first install, he said.

BT said it's buying much of the Wi-Fi equipment from Cisco Systems. Motorola will help BT sell the Wi-Fi service and will help install the equipment in cafes, restaurants and hotel lobbies. How much and how the company intends to charge for service has yet to be set, Hughes said.

Graeme Wearden contributed to this report.