Select Page December 18, 2002 Intel Begins Doling Out Wi-Fi Money By Michael Singer

Making good on its promise to spend $150 million on building up smaller Wi-Fi (define) technology companies, Intel (Quote, Company Info) Wednesday said it was investing in two startups.

The Santa Clara, Calif.-based chipmaker said it’s Intel Communications Fund division is plunking down an unspecified amount of cash to help Salt Lake City-based STSN and Bellevue, Wash.-based Telesym develop their products.

Intel has said it plans on making about 30 or so of these investments in smaller companies that have survived after their series A or B funding rounds. The money would come from Intel’s previously established $500 million Communications Fund.

Wi-Fi (also known as IEEE standard 802.11b) is an emerging and increasingly popular technology that provides high-speed wireless Internet access in many locations around the world, including airports, cafes, corporate offices, universities, factories and homes.

The Fund now has completed three investments in Wi-Fi companies since October when Intel announced plans to invest in companies pursuing Wi-Fi technology. The first investment was in Cometa Networks, a joint project announced with IBM (Quote, Company Info) and AT&T (Quote, Company Info) back on Dec. 5.

Intel said it intends to use the technology from STSN and Telesym to complement its next generation mobile technology, codenamed Banias, which will be introduced in the first half of 2003.

“Mobile computer users will have real-time wireless Internet access from STSN-enabled hotel rooms and will be able do innovative things like turn their laptops into wireless speaker phones with TeleSym’s software,” said Intel Communications Fund director John Hull.

STSN provides wired and wireless high-speed data communications to hotels and conference centers around the world. STSN’s products allow for high-speed data communications connections in more than 120,000 guestrooms and 4,000 hotel meeting rooms worldwide. Intel Capital first invested in STSN in 1999.

TeleSym develops “SymPhone System” a voice communication software over wireless networks. The company’s software can be used on mobile PCs and personal digital assistants.

Part of the driving force in developing Wi-Fi is the emergence of the commercial hotspots, like those offered by Starbucks (Quote, Company Info).

High-tech marketing research firm In-Stat/MDR predicts the marketplace will expand from 2,000 locations in 2001 to 42,000 sites worldwide by 2006.