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Change is in the airwaves

As cellphone firms consider opening networks, startup is ready to carry signal

Email|Print| Text size + By Carolyn Y. Johnson
Globe Staff / November 29, 2007

CAMBRIDGE - The cellphone world is poised for disruption, and local start-up Vanu Inc. is positioning itself to take advantage of the transformation.

Over the past decade, Vanu has developed what seems like a fairly esoteric technology - software that can control how a radio transmits and receives signals. That means a single base station at the bottom of a cell tower could be tuned for everything from an AT&T iPhone to a Verizon Wireless cellphone, instead of requiring separate racks of hardware.

With the traditional cellphone model in the United States beginning to crumble, the moment may be emerging for Vanu's technology.

This week, the country's second largest cellphone company, Verizon Wireless, announced that it would open its network to allow customers to use mobile devices, software, and applications developed by other companies by the end of next year. Internet search giant Google is trumpeting efforts to create an open platform for mobile devices with partners such as T-Mobile and Sprint. The iPhone is expanding people's expectations of a "phone" while also reminding them of the limitations - people who spend hundreds of dollars on the phone can use it only on one network. And an upcoming Federal Communications Commission auction of radio airwaves that can carry calls and data raises the possibility of a new company building a national cellphone network from scratch with inherent flexibility to work with different technologies and devices.

"People are interested in open networks. . . . We think it's really a good opportunity for our technology," said Vanu chief executive Vanu G. Bose, who has deployed his technology in rural cellphone networks in Alaska and Texas but has a bigger vision - building a national network with his more efficient technology.

Vanu has partnered with Frontline Wireless, which has a novel plan for some of the airwaves that hit the auction block this January. Frontline wants to win a slice of the spectrum and build a national, open-access network that could double as a public safety and commercial network.

But key to Frontline's proposal is the idea that the network would support a variety of different devices and standards, in contrast to today's cellphone networks. For instance, the Verizon Wireless network, which uses a network standard called CDMA, is different from the one that carries calls from AT&T phones, called GSM. Vanu's software solutions would allow one base station to carry both, similar to the way that a computer can juggle multiple tasks at once, such as running a Web browser and a spreadsheet program simultaneously.

At a demonstration in Vanu's Cambridge office, Bose - son of Amar G. Bose, founder of the high-end audio company Bose Corp. - showed how a base station that uses his software can run calls on both networks. Normally, radios that transmit and receive signals are built to work with a particular technology and within a specific frequency range. Vanu's technology allows software to determine those specifications, meaning that a single laptop could determine whether a radio picked up FM radio, walkie talkies, or cellphones.

Vanu's technology could also become more directly relevant to consumers. Vanu and BitWave Semiconductor Inc. in Lowell announced earlier this month the successful demonstration of a prototype of a femtocell, a device that acts like a mini cell tower to boost a wireless signal in a building. Using Vanu's software, the device could increase wireless coverage in the home for the next generation of devices that will work on the new spectrum being auctioned off in January. Because of Vanu's flexible technology, the femtocell can be designed without knowing ahead of time who will win the auction, or what technology will need to be supported.

Eventually, Vanu's technology could be used to create a phone that was agnostic to the network, working on Verizon Wireless, AT&T, and any other network.

"There is no question that software is the future of radio, just as most other information technology related things we do have already migrated to software," Andy Lippman, director of the Digital Life program at the MIT Media Lab wrote in an e-mail. "The next step is for this approach to migrate to personal devices, which is a long tunnel with glimmers of light at the end," creating phones that can communicate on any network.

While such a phone is likely years away, Vanu's technology may become more appealing to wireless providers.

Carriers are increasingly finding themselves in the position of running more than one type of network at the same time. For instance, Sprint and Nextel merged, and now run different technologies side by side. Or carriers that spend billions on expanding and upgrading their networks could save money by just downloading new software when they need to update their technology.

This month, Mid-Tex Cellular in Texas, which already ran a network compatible with AT&T and T-Mobile phones, used Vanu's Anywave technology to add CDMA, the technology used by Sprint and Verizon Wireless phones. It added a whole new network and picked up roaming revenue from those customers just by downloading software.

But the biggest opportunity for a company like Vanu may lie in developing countries, where networks are still being built for the first time. Vanu is working with IBM on a trial in India that uses the latest hot innovation in software - virtualization - to make wireless networks more efficient.

In India, companies building a new cell network in a rural village may expect $1.50 per customer per month, as opposed to about $50 in America, Bose said. Vanu's technology means that several providers could share a single base station, using software virtualization to effectively run several virtual base stations off the same equipment, divvying up the traffic among different providers.

"Emerging markets are becoming like incubators," said Shiv Bakhshi, director of mobility research at IDC. "You incubate the idea there, get proof of concept. . . . Then you bring it home to the bigger markets . . . there are too many people here with too many interests to let any innovation go through to disrupt the market."

Carolyn Y. Johnson can be reached at cjohnson@globe.com.

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