Intel said Monday it’s creating a WiMAX service joint venture with a British Internet service provider to promote the emerging long-range broadband wireless service.

said Monday it’s creating a WiMAX service joint venture with a British Internet service provider to promote the emerging long-range broadband wireless service.

The chip giant, through its venture capital arm, is forking over $25 million to create Pipex Wireless with Pipex Communications, a public company that provides broadband services to businesses and consumers and is among the top five operators in the United Kingdom.

United Kingdom

Pipex also is putting in money, although the company declined to disclose the amount. Pipex also is transferring its 3.6GHz license to Pipex Wireless. A licensed spectrum isn’t necessary to operate a WiMAX service, but it prevents interference and other problems that can come up when an operator delivers service over an unlicensed spectrum.

The deal, inked over the weekend, reflects Intel’s plan to use its wealth to promote a technology that it hopes will be as popular as Wi-Fi. Whereas Wi-Fi covers a small area—an office, home, or a café—WiMAX signals can reach miles and create a regional wireless network.

“Pipex Wireless will compete in this new market by targeting customers who need more than just fixed broadband to home or office,” said Bill Kilmer, managing director of IntelCapital in Europe who will sit on the board of the joint venture.

Intel who will sit on the board of the joint venture.

Based in Santa Clara, California, the chip company, has invested heavily in WiMAX, which stands for Wireless Interoperability for Microwave Access. Intel, which popularized Wi-Fi by selling Wi-Fi chips along with computer processors as part of its Centrino brand, hopes to repeat the success with WiMAX.

Santa Clara, California

The chip company plans to roll out WiMAX chips for laptops next year. It will begin selling Intel-branded WiMAX PC cards later this year. Its engineers also are working on putting Wi-Fi and WiMAX on the same chip.

Several chip startups, including Telesis Wireless, are doing the same. Telecis, based in Santa Clara, California, said it received $10 million in a third round of funding from ATA Ventures and an unnamed corporate investor.

Santa Clara, California

Two months ago, IntelCapital said it had put in an undisclosed amount of money in DBD Deutsche Breitband Dienste, a private wireless service company in Germany that would use the money to promote WiMAX.

Intel that would use the money to promote WiMAX.

“Service providers may not want to build networks if there are no end-user devices,” said Phil Solis, an analyst with ABI Research. “Equipment companies may not want to build WiMAX into mobile devices if there are no networks. Intel solves that chicken-and-egg problem.”

Pipex Wireless plans to roll out the WiMAX service in 2007, starting in London and Manchester. The company is now hunting for a CEO to lead Pipex Wireless.

Manchester

Intel shares rose 0.02 to $19.48 per share in recent trading.

Pipex Communications generated £133 million ($231.3 million) in sales in 2005, up 30 percent from £102 million ($177 million) in 2004. It posted a loss of £7.1 million ($12.3 million), 42 percent wider than a loss of £5 million ($8.7 million) in 2004.