This is Bloomberg Business Week with Carol Messer and Tim Steneveek on Bloomberg Radio.
I want to shift the discussion and now to communications and telecoms because data is from the National Telecommunications and Information Administration shows that roughly one in five US households are not online, and that's especially in suburban and rural areas. So of course this is an important priority for the Biden administration, which has earmarked forty two billion dollars in grants to help kind of bridge this digital divide. But it's also a major issue outside the United States. So
enter this space. Toronto Wireless, which has spent over a decade developing a network to rival fiber with less physical infrastructure. We're going to novel way to direct wireless signals around obstacles. The company announcing today that it raised fifty million dollars from Digital Alpha Advisors, a VC that focuses on digital infrastructure. And mind you, it was already valued last year at over a billion dollars. So here we have with us in the interactive broker studio is Basil all One. He
is the CEO of Toronto Wireless. Passil thank you so much for joining us. In studio as well.
Yeah, I know, thanks for having me. I appreciate it.
Explain to us first why Toronto's technology is different.
Yeah, it's an important question because people as there's a lot of wireless technology around your satellite. Of course, wireless, there's five G, there's Wi Fi, and Toronto actually started more than a decade ago. As you noted, it's a very deep tech company with the idea that home broadband it's incredibly voracious. It takes about thirty to fifty times more band with to serve a home than to serve a mobile, So there had not been yet built a
wireless technology for home broadband. Instead, there were other technologies being used that can kind of do the job.
But what people really.
Want, especially now, is they want a high speed connection, low latency, and they wanted to rival fiber in terms of performance, but they'd like to deliver it from a wild's point of view.
So this is.
A really deep dive rebuild of wireless technology with some really advanced tricks to get better performance non line of sight in both license and unlicensed spectrum. And if you're familiar with that, that's a pretty interesting trick.
I'll turn the microphone on and join the conversation. A heavily regulated industry when it comes to that spectrum. But explain the tech here, because the road to providing you know, wireless internet to homes is paved with the carcasses of
many a company. I was there when Starry launched its service, right, that was one that was promising in cities that believe was line of sight though, Yes, so how do you do this in a way that does it for a cheaper does it cheaper than the wireless companies like T Mobile, A T T and Verizon, but also does it without the infrastructure of the large carrot telecom carriers.
Yeah, it's of course it's a bit complicated, but it's really fundamentally important right now because you know, digital divide is so critical at the moment.
So look at it this way.
In the world of spectrum, you know, you have really high frequency spectrum, which is really good at high speeds because it's high frequency, but it's line of sight and it's also impacted by weather a very high frequencies. So that technology is really good for speed, but it's not so good because if you have to have a tower within line of sight to every home, you're trying to serve it's incredibly expensive because you have to have thousands
and thousands of towers in every city. On the other hand, you have low frequency spectrum six hundred eight hundred makes like the spectrum just sold between T Mobile and Comcast.
Today was announced that.
Spectrum is incredibly good at distance, but it's not quite as good at really high speeds.
You have to use a lot more spectrum.
Midband, right between two and seven gig hits, where we operate, is kind of that sweet spot. You get non line of sight like low frequency signals, travels nice around corners, and but you also get very very good speeds. The challenge with midband is it's all used for the mobile network, and if they think about the economics of delivering bits to customers, the mobile ARPU, a revenue per user is about the same as you get for a home. Yet to support a home you have to deliver thirty to
fifty times more bits in a given period of time. Yeah, we stream a lot of Netflix, yeah right, right right, and on big screens, which really makes the difference, and now on demand, which makes it even more difficult. So the challenge has been how do you solve that problem. How do you get better spectral efficiency specifically, but also can you use both licensed and unlicensed and still deliver a reliable service? And that's basically the technology Toronto has perfected over ten years.
I'm an obvious said this talk to about why use unlicensed spectrum?
Right?
It's great, No, it's a really important question. The reason is is that the licensed spectrum is often is pretty quickly consumed by the mobile network in that sweet spot of spectrum where you want to operate, and so you have to decide how you're going to handle that. Either you allocate more to fix, but you know you're not going to get much money for that, or you can
avail yourself of unlicensed. The problem with unlicensed is that at any moment in time, somebody else can start using it as well, and then what happens to your signal if somebody nearby starts transmitting in the same spectrum. And the technology that Toronto really innovated here is the ability to cancel that interference, basically not listen. It's a way to think of it is and this is a really
good analogy. You're sitting in an auditor or in an audit a groom full of people, and there's someone twenty people a way that you want to listen to, and people are talking pretty loud right next to you. We have the ability in real time to silence, not jam, but just not listen, to mute from our point of view all those signals that are really close and listen to that distant signal, and we actually picked that signal up. That is a very unique technology requires CHIFS digital signal processing.
It's a pretty interesting trick.
So who are your customers and your potential customers? If we think about rural areas, increasingly they're being served by companies like Starlink that's satellite right band. Densely packed areas, especially in the United States, can be served by wireline operators. You are already have laid the cable and done the groundwork.
Exactly who are your customers?
Yeah, so another really good question, because what you learn if you're in this business of delivering broadband is that you need a toolkit. You don't need just a tool. It's like telling someone to build a house with a hammer. You're saying, no, I'm going to.
Use the right tool for the job.
In the dense areas, as you note, oftentimes not always, but oftentimes fiber is the right answer. It it's expensive to do, but you have enough density to justify the economically.
It makes sense.
In the ultra remote where there's no infrastructure, satellite is really the only choice, honestly because you you know, House and Leo satellites are quite good for that. There's no way to solve this problem, and it is a real challenge for the country. Our country, but curls around the world without solving it with multiple tools. And where we come in is actually between and and so let's say
sparse urb and dense herb rural. It's very hard from a capacity a pointing for the satellite to really support that. In mass it's very hard to get the economics out of fiber. So we come in and help right there. And that's where where, And that's by the way, if you look at it, it's a big part of the problem.
One of the one more comment on that. You know, there's a lot of focus right now on the Infrastructure and Jobs Act and the forty two point five billion dollars you mentioned, but what's not as reported is that in the US, which is kind of interesting, we have about one hundred and thirty five million households. There's about fifty million households that have exactly one choice that are not one choice for internet service providers, that are not
considered unserved or underserved. So there's a there's a big opportunity to help there as well.
So what is the equipment that you need? When I got FiOS, the guy just came and ran a fiber optic line from the basement up to my building, and we have, you know, the Verizon modem. What's the equipment that you need.
Yeah, it's almost it's almost the same. You have a little device, although in our case you have a small antenna about the size of us all notebook computer. It's flat, so it's not like the size of a big satellite dish. It's pretty it's pretty small. And you put and that's on the outside of your house pointing in the general direction of a tower or a building where our receiver is. You run an Ethernet cable into your house and you're done.
That's it, and that's it. And then on the other side, we of course grab all those signals and and connect them to the Internet.
I believe you talked last year, maybe last March, about the potential to maybe go public in twenty twenty three. Is that something that's still on the table to help you grow.
I think twenty twenty three is certainly not. But I will say this is this company is interesting and one of the reasons I'm enthused about it is that it's it's the intersection of a quite large market globally and very very deep technology difficult to reproduce. You know, a lot of sweat equity has gone into this company, So I think it does warrant potential for a public offering.
And we're still you know, building the company and let's see.
Yeah, I mean, you know, look, I mean it's it's going to depend on the market, but it's also going to depend on our progress. But right now it's looking quite good.
How much is this service per household? And does it depend on how much usage you have?
Yeah, so it varies. It's not usage based generally. Our customers of our one of our customers just launched a service on our equipment that's offering two two hundred down fifty up for fifty bucks. Other people are offering four hundred made services. And now we're launching a gigabit platform and that's going to launch n Q four, so you can do gigabit down and in fact we just shipped our first units that this week and as much as five hundred megabits up, so it's a really strong service.
So you can get tiered services like you have on others. You have kind of a starter package. You can get a little bit more, pay a little bit more of.
That kind of thing.
So interesting.
Thank you.
Basil all One, he's the CEO of Toronto Wireless. He joined us in the studio to talk about interesting wireless technology.