Calypso Wireless, the wireless company trying to charge a licence for any roaming between Wi-Fi and cellular networks on the basis of a controversial US patent, says a service provider is about to licence its technology. However, a report from an intellectual property lawyer claims to have found prior art that would invalidate the patent.

Calypso has claimed the right to charge licences for all cell-to-WLAN roaming on the basis of US patent 6,680,923 issued in January, which covers automated handover between different wireless networks. Now the company says a service provider is "in negotiations" to license Calypso's ASNAP technology.

Calypso would not say what company it is negotiating with. It is most likely a US service provider, although the company says it is aggressively pursuing mobile carriers, not limited to Europe but Latin America, Canada and Asia as well. The claims it makes for the patent, if upheld, would certainly require BT to pay royalties for the Bluephone cell-to-Bluetooth roaming system jointly announced with Vodafone last week.

However, patent advisory firm Patent Metrix claims to have come up with "prior art". The company has found a specific US patent, issued in January 1995, that covers roaming between wireless base stations and the cell network.

"An express statement in the earlier patent talks about automated handover," said Hazim Ansari, chief executive of Patent Metrix and author of the report. He does not claim to have the definitive answer, only ammunition for companies approached by Calypso, who would use the earlier patent to argue that Calypso's should not have been issued, and punt the whole issue back to the Patent Office.

"The Patent Office only has a limited amount of time, so it is natural for mistakes to be made. In the wireless world, the patent office doesn't appear to be sufficiently taking into account the history of wireless communication in evaluating patents submitted."

Ansari has showed Techworld his nine-page report, but asked us not to reveal the details, including the number and owner of the earlier patent. The report is for sale for $295.

Reading between the lines, it may be that Calypso's "negotiations" are to sell its ASNAP technology, rather than licence its patent per se. ASNAP includes a WiFi-to-cell roaming phone, and software to handle the all-important political dimension, linking the different service providers' billing systems, so both get a revenue share

"Why would a [cellular] carrier hand off its client to a [Wi-Fi] ISP, unless there is a revenue share?" asks Calypso spokesman George Schilling. "Multi-billion dollar companies don't want to hand clients away. What our technology does is provide the carrier with the ability to connect and share the revenues."

Maybe, but does the patent cover revenue-sharing? Schilling says it does: "Billing and revenue sharing is in the patent". Then he hesitates: "If it's not in the patent, it is part of the programme." A quick re-read of the patent reveals no mention of revenue sharing.

It's our guess that whoever is talking to Calypso is evaluating its technology, checking out how good its seamless roaming is compared to other offerings, and comparing its revenue-sharing against other billing systems. If it's trying to extract patent royalties from competing technology, we expect it is getting short shrift, though Schilling claims not: "We haven't been challenged on the patent," he says. "If others try to deploy this technology, we will put them on notice. We will protect our patent."

Schilling wants to see a little ASNAP sticker on every next-generation roaming phone, "similar to a computer with an Intel Inside label". Calypso hopes its patent will keep any AMDs out of the market, or at least force them to hand over lots of money.

Ansari begs to differ: "Smart wireless companies will be evaluating deals with Calypso based on its technology, not its patent position," he says. And maybe, behind the bluster, Calypso is preparing to accept this: "When we come out with our phone, it will hopefully be the best in the marketplace," said Schilling.