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March 9, 2021
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Business Review Western MI
Business Review Western MI
Internet Company Sale
(2007-04-11)
(wgvu) - Local investors earned a tidy payoff when they sold scarce licensed
spectrum to emerging national wireless Internet player Clearwire Inc.

It worked so well, they want to do it again.

We've been approached with some additional opportunities with licenses
in multiple-channel groups, so we'll probably be doing this in other
parts of the state, said Dan Carter, a shareholder with Grand Rapids
accountants and consultants Hungerford, Aldrin, Nichols & Carter.

Carter also wears the hat of managing partner of West Michigan Wireless,
which for the last nine months has done business in Ottawa County's
Jamestown Township as BroadBreeze Communications. BroadBreeze operated a
wireless high-speed Internet service under a memorandum of understanding
with local officials that called for wider deployment throughout the county.

BroadBreeze recently backed out of the arrangement. It sold the 2.5MHz
spectrum it had leased from Plainwell Community Schools to Kirkland,
Wash.-based Clearwire. That company is snapping up bandwidth to do
battle with Sprint Nextel Inc. in the next-generation wireless market.
(See related story on page 1.)

Having bet on so-called 3G wireless technology, BroadBreeze last summer
found itself in danger of being engulfed by the WiMAX service being
readied for sale by Clearwire and Sprint Nextel, Carter said. Moreover,
his company didn't have enough bandwidth to make the switch to WiMAX, he
said.

We tried real hard to acquire that, and of course we were going up
against Sprint Nextel and Clearwire, Carter said. They're both
800-pound gorillas, and we're just the local guy.

But the bandwidth the company did hold paid off. I would say it went up
10 to 20 times in value in the year or two West Michigan Wireless held
the lease, he said.

That spectrum accounted for about 80 percent of the operation's assets,
he said. The company's hardware was sold to aerospace giant Northrop
Grumman Corp., the contractor for a wireless Internet project in New
York City.

Caught off guard, local officials brought the company back to the table
to work out a service hand-off to Grand Rapids-based Internet provider
Michwave Technologies. That service will use a more traditional
point-to-point technology requiring line-of-sight connection, however,
which is more easily blocked by terrain, foliage and buildings than 3G
signals.

That could leave some customers without service, officials worry.
BroadBreeze served approximately 120 subscribers, Carter said.

This will set us back at least 18 months, said Mark Knudsen, director
of Ottawa County's planning and grants office.

But now, he said, officials are talking to Clearwire to roll out its
service there on similar terms to those extended to BroadBreeze. Public
high points such as water towers are made available to private companies
to mount transmitters and antennas to serve local residents, without
expenditure of public money.

We saw (the asset sale) as an opportunity to maximize return for our
investors and assist in the development of the technology in western
Michigan, BroadBreeze general manager Bryan Blackburn said.

I envision all of Michigan being covered to the degree cell phones are
covered today, to the point where you will be able to move about the
state and have your wireless broadband roam from tower to tower
seamlessly, Blackburn said.

Investors in his company include Rusche Trucking Inc.; William Charles
Executive Search; Exhibit Design Consultants Inc.; McKay Tower;
Seyferth &Associates Inc.; and others, it reported.
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