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UPS cuts the cord

Company says wireless project will create largest Wi-Fi network in the world, eventually connecting 55,000 devices.

Delivery giant United Parcel Service is making a $200 million global investment in Bluetooth, Wi-Fi and cellular technology--a move that should put an end to delays caused by snapped connector cables linking workers' equipment.

UPS, with annual revenue of $33 billion, said the project should speed up package tracking and help create customized services.

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The first phase of the largely in-house project will involve equipping package sorters with Bluetooth bar code scanners--worn on a middle finger--that send tracking data to Wi-Fi transmitters worn on belts. Previously, scanners were connected to data collection devices by cables that could break.

UPS expects to reduce repair costs by 35 percent and gain similar savings on the cost of spare equipment. The company said the project will create the largest Wi-Fi network in the world, connecting 55,000 devices when it is completed in 2007.

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In addition, company drivers will this month begin receiving UPS-designed handheld data collection terminals. The frisbee-size devices, developed with Motorola and Symbol Technologies for a total cost of $100 million, can be connected to Bluetooth, Wi-Fi, General Packet Radio Service and Code Division Multiple Access networks.

Faster data collection means that UPS can let customers know in advance that they can expect to receive a parcel and when it will arrive, UPS Chief Executive Mike Eskew said.

"Visibility has already allowed us to improve our service and cut costs (of customer queries) from $2 to one penny," he said. Drivers will also be able to transmit parcel data directly into customers' systems when they make deliveries using Bluetooth and Wi-Fi technologies.

Information about routes and how to pack a vehicle will be downloaded to the new data collection terminals. The company also plans for the terminals to connect via satellites using Global Positioning System, so it will be possible to tell drivers if they are in the right place for a particular delivery.

John Lamb of reported from London.