Fixed wireless network operator, BigAir, has moved a step closer to gaining critical mass, acquiring the iBurst mobile broadband customer base of ISP, OzEmail.
The 3000 customers were now being brought across into BigAir's reseller subsidiary, Veritel Wireless, according to managing director, Jason Ashton. The deal boosts the Sydney-based telco's subscriber base to 7000. It is aiming for 10,000 customers by this time next year.
OzEmail was acquired by WA-based ISP, iiNet, in February for $110 million. The sale saw its 47,000 dial-up, broadband and wireless broadband subscribers transferred across to iiNet.
Wireless broadband services had been provided across the iBurst network.
"We knew that iiNet had a clear DSLAM strategy based on fixed wire networks," Ashton said. "There was an opportunity for us to make an offer for the iBurst subscribers, so we approached them and did the deal."
iiNet managing director, Michael Malone, said its aim was to focus on its core dial-up, ADSL and telephony product lines. "We'd rather see those [iBurst] customers move to a provider that is focused on those particular products," he said.
Malone said iiNet had no intention of playing in the wireless space. It had established a wireless network in Perth, called Cityspan, but opted to abandon the technology in favour of ADSL.
BigAir is a licensed carrier operating its own fixed wireless network across Sydney. The infrastructure is used to deliver Internet access, VoIP and IP Centrex services. It also provides iBurst and Unwired network connectivity through the Veritel subsidiary, which was acquired in July.
"We have to build critical mass in this space if we want to get good margins, particularly as we have wholesale access to the [iBurst] network," Ashton said. "We need a large customer base to get the economies of scale. Veritel offers mobile wireless but BigAir is business grade high-speed fixed wireless. We want to offer both to business customers."
The deal comes on the eve of BigAir's plans to go public on the Australian Stock Exchange. The company is instituting an initial public offering in December to raise $10 million to invest in capital expenditure. Ashton said the money would be used to take its infrastructure outside of NSW. In the long term, he said the company would also look to implement a single brand.