Subject: [NEXTEL-1] Ricochet Changes Hands, Again

From: NEXTEL-1
Date: Wed, 30 Jun 2004 16:47:13 -0400

Ricochet Changes Hands, Again
BY SUSAN RUSH
JUNE 30, 2004

Ricochet Networks is living up to its name. For the fourth time since
its inception, the company is rebounding, bumping off one owner and
landing at the feet of another. The latest: YDI Wireless has picked up
the broadband wireless service in a cash and stock deal.

Metricom, Ricochet's original parent, first rolled out the wireless
broadband service in the mid-1990s. At its peak in early 2001, the
Ricochet network spanned 21 cities with 51,000 subscribers, but then the
bottom seemed to fall out. Since Ricochet's inception, Metricom was
hailed as a forerunner in the wireless broadband market, but the high
cost of building out its network forced Metricom into bankruptcy.

Just when everyone thought Ricochet would go by the wayside,
Denver-based Aerie snapped up the lion's share of the Ricochet network
assets for $8.25 million in a bankruptcy fire sale in November 2001. The
company re-launched the service in Denver in August 2002 and in San
Diego three months later.

In December 2003, Aerie turned around and sold Ricochet to EDL for an
undisclosed sum. At the time of the purchase, EDL said it had plans to
ramp up the service by expanding service coverage in both the Denver and
San Diego markets. Ricochet currently serves about 7,000 customers in
Denver and San Diego.

Enter YDI. The company will fork over $3 million in cash, plus 42,105
YDI common shares and an unsecured note for $300,000 payable over three
years. Despite Ricochet's rocking past, YDI management is pumped about
the service's addition to the YDI portfolio. "With the purchase of
Ricochet, YDI further expands the breadth of its product offering with
robust mesh technology products operating in the 2.4 GHz and 900 MHz
frequencies," YDI's CEO Robert Fitzgerald says. "We have been very
impressed with the stability and quality of Ricochet's mesh technology
networks and feel that these offerings will be well-received by YDI's
service provider customers."

The purchase of Ricochet marks YDI's first foray into the service
sector. "[The purchase] lets us get into the service business. We will
benefit from the experience [Ricochet] has in the service business so we
can understand the concerns of our customers," YDI spokesman David
Renauld says. Renauld acknowledges that there is a risk in the Ricochet
purchase, but says in the past Ricochet has been primarily focused as a
service provider. "We are not looking at it as a pure service company.
We are looking at it as a service company as well as an equipment
provider," Renauld says. "We think the service is a powerful piece of
what Ricochet brings, but we think there is another component: adding
the equipment sales piece to the overall package."

YDI plans to retain Ricochet's current employees except its president,
Victor Mitchell, who is leaving the business to return to school. The
company will continue to sell the wireless broadband service under the
Ricochet brand name, says Renauld. YDI also is exploring the
possibilities of reactivating Ricochet's networks that lay dormant in
other markets. The purchase opens up the ability to start up new
networks with very little investment, Renauld says.

YDI's stock made the transition today from the Over The Counter Bulletin
to the Nasdaq. Following news of its latest acquisition, YDI shares were
up 13 percent to $5.65 at one point during morning trading action. YDI
has made a string of acquisitions lately. Most recently, the company
completed its merger with Terabeam. The company also has merger deals
with Phazar and KarlNet.
http://www.wirelessweek.com/index.asp?layout=newsat2direct&starting=1&pubdate=06/30/04

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