Chariot to exit wireless

ISP puts its wireless network, Omninet, up for sale just 18 months after acquiring the business

After only 18 months in the wireless game, Adelaide-based ISP, Chariot, is looking to sell off its wireless division, Omninet.

The sale comes after a rocky 10 months for Chariot, in which the ISP was sued by Transcom International for alleged breach of contract and damages from a business relationship. And in an unrelated incident, Chariot's managing director, Robert Horlin-Smith, resigned after having to stand trial for alleged misconduct while at the helm of another company.

Although new CEO, Garry Heresy, announced last year that the company would undergo a major operations restructuring "to improve its on-going performance and financial position", the sale may surprise the ISP's regional customers who largely rely on wireless technology and make up about 75 per cent of Chariot's customer base, according to past statements from marketing manager, Kimon Lycos.

The sale is also at odds with statements from Horlin-Smith, who said Chariot planned to rely on wireless to reduce legacy and dependency costs to enable better prices to customers and higher margins for resellers.

The sale advertisement, which appeared in the Australian Financial Review, said: "Chariot has determined that wireless is not a core activity and is divesting its wireless interests through the sale of shares in its wireless subsidiary, Omninet Wireless Pty Limited ("Omninet"), or through the sale of Omninet's assets and business".

The Omninet wireless network, which was established in 1999, provides wireless Internet access through a WiMAX-based network in regional Victoria, New South Wales and South Australia (metro Adelaide). Chariot acquired the Melbourne-based business in 2005.

"The Victorian network core is fibre-based, while in NSW the core is based on high-capacity licensed digital microwave," read the Chariot ad. "There is significant opportunity to fully utilise the network in Victoria and New South Wales for carriage and residential broadband customers."

Hersey was not immediately available to comment on the change in company direction and what it means for the ISP's large regional customer base.