Prime Day can't-miss deals Cheapskate's favorite Prime Day deals Target's rival sale Walmart's competing sale Best Buy's me-too sale IRS child tax credit portal

Net service Ricochet bounces into new hands

Struggling company was a pioneer among wireless Internet service providers. New owners hope to catch it on the rebound.

Struggling Ricochet Networks, a pioneer among wireless Internet service providers, has been bought by YDI Wireless in a deal valued at $3.5 million.

The cash, stock and debt deal is seen as one that will give Denver-based Ricochet new life. Over the past several years, Ricochet has seen its ISP presence shrink to two markets, San Diego and Denver, from more than a dozen metropolitan areas. It's also undergone three ownership changes.

YDI, a provider of wireless-infrastructure products, hopes to relaunch the service in New York, Los Angeles, San Francisco and the other major cities where the ISP used to operate. The company plans to retain the name "Ricochet" for the service. YDI will also make use of auxiliary products and technologies that Ricochet had developed for use with its service.

"Although Ricochet has generally operated as a service provider, this is a great match for YDI," Robert Fitzgerald, YDI's chief executive, said in a statement. "With the purchase of Ricochet, YDI further expands the breadth of its product offering with robust mesh technology products operating in the 2.4GHz and 900MHz frequencies."

YDI's customers had been asking for products in the low-frequency range, which allows wireless connections to pass through walls and other obstacles. The company had been offering only high-frequency, or line-of-sight wireless offerings. The Ricochet deal also gives YDI an Internet service option; the company had previously only been a product vendor.

Ricochet was initially owned by Metricom, which filed for bankruptcy in mid-2001. Aerie Networks acquired Ricochet for $8.25 million later that year, when it purchased some of Metricom's assets.

But despite plans for a Ricochet comeback, the service has continued to struggle. Last November, Aerie began asking retailers to stop selling subscriptions to the service, as it sought new investors.

Ricochet was sold in December to EDL Holdings, which in turn sold it to YDI Wireless.

Despite momentum for wireless broadband, at $70 a month, Ricochet was too expensive for most people. Nationwide expansion plans were also marred by difficulty getting space for antennas on street light poles and other municipal rights of way.

CNET's Ben Charny contributed to this report.