Florida-based vendor xG Technology recently announced that it has signed an agreement with independent local exchange carrier Townes Tele-Communications to test and evaluate potential deployment of xG’s xMAX solution, which is designed to provide low-cost mobile communications for a variety of purposes, including public safety.

Townes is expected to test the xMAX technology in its territory — likely in Arkansas — during the next month and conduct due diligence on the startup company before deciding whether to deploy the solution over a greater area, said Benjamin Dickens, a partner in the Washington, D.C.,–based telecommunications firm of Blooston, Mordkofsky, Dickens, Duffy & Prendergast, which represents Townes.

“Townes, like so many independent phone companies in the U.S., has been looking for a wireless solution that makes sense,” Dickens said during an interview with Urgent Communications. “Independent telephone companies serve high-cost, sparsely populated areas, and you don’t have the same economies of scale that you have in the urban areas that most of the large telephone companies like Verizon and AT&T serve.

“When xG’s technology came along, Larry Townes — the owner of Townes Communications — became interested in the promise that technology might deliver for a rural area — not just for mobile but broadband applications, which appear increasingly necessary if you’re going to compete with bundled services that are being offered by competitors these days.”

If its tests of the xMAX technology go well, Townes not only will pursue deployment of xMAX, it will invite other independent phone companies to participate in a new entity called NewCo, with the idea of deploying xMAX throughout the United States, Dickens said, adding that independent carriers could use universal-service funds — and, potentially, stimulus money dedicated to rural broadband deployments — to finance the deployments.

Since announcing its patented xMAX technology several years ago, xG has expressed confidence that its solution would provide a lower-cost, mobile VoIP alternative to expensive cellular technologies. However, the company’s technology has not been deployed in a commercial network to date, which has led some skeptics to question the viability of xMAX, which is supposed to provide 4G performance while operating in the unlicensed 900 MHz ISM band.

Rick Mooers, chairman and CEO of xG Technology, said testing of the xMAX base stations and dual-mode handsets — devices that work on xMAX networks or Wi-Fi networks — is progressing well, albeit slower than company officials originally hoped.

More than a year ago, xG signed a similar agreement with global telecom carrier Telefonica for a potential deployment in Mexico, but the company has yet to sell any gear associated with that relationship. Mooers said he believes independent telephone carriers are a logical partner for xG.

“This is the partner that allows us to put a whole network out,” Mooers said during an interview with Urgent Communications. “These are extremely successful businessmen that have plenty of liquidity and profits … and this brings us all a brighter future.”

After xG has rolled out xMAX successfully on a commercial level, Mooers said the company will work to develop hardened solutions for the first-responder markets — a logical sector for xG to address, because its devices also provide the peer-to-peer functionality needed by first responders if a network is unavailable.

“As we get it rolled out and the markets mature, we’re going to partition off a part that will be dedicated to police, fire and homeland-security issues,” Mooers said. “We’re either going to do that free or at cost with the government — that’s what we’re considering.”