Cometa Networks, the venture backed by AT&T, Intel and IBM, is closing its doors after it was unable to raise substantial backing to stay afloat.

The Wi-Fi company issued a statement today saying it will suspend operations within the coming weeks because the financial return for investors was not perceived to be sufficient to attract the necessary capital. Cometa employs about 40 people, some of whom will remain through the transition, in offices in Seattle, San Francisco and Schaumberg, Ill., a company spokeswoman said.

"We want to thank our employees for their loyalty and hard work over the past 18 months. It is disappointing to have to stop our nationwide expansion at this time," CEO Gary Weis said in the statement. "We do not think this reflects on the strength of the Wi-Fi industry or value proposition. We will work closely with our customers and partners to determine how they wish to proceed."

Cometa was formed in 2002 with the goal of providing wholesale wireless Internet access to telecom companies, ISPs, cable operators and wireless carriers.