US telecoms giant Sprint Nextel and Washington State-based Clearwire have completed a deal to combine their wireless Internet businesses, opening the way for roll-out of a nationwide WiMAX service.
Sprint has handed all of its 2.5GHz spectrum and other WiMAX-related assets, including the Xohm service, to Clearwire, which has also received a $3.2 billion cash investment from Comcast, Intel, Time Warner Cable, Google and Bright House Networks. The new company retains the name Clearwire and remains headquartered in Kirkland, Washington. The investors hold 22 per cent of the new company, the original Clearwire owners – who include serial telecoms entrepreneur Craig McCaw - 27 per cent and Sprint a controlling 51 per cent.
Financially troubled Sprint and Clearwire, operator of a network based on WiMAX precursor technology in a number of US states, were involved last year in an on-off courtship. Now they have joined forces to advance the vision of US-wide pervasive wireless Internet access based on “WiFi on steroids” WiMAX, with its greater reange and superior bandwidth.
“We’ve made an excellent start developing WiMAX services under our Xohm brand,” said Sprint chief executive Dan Hesse earlier this year. “Contributing those advances to a strongly backed new company in which we’ll hold the largest stake provides us with additional financial flexibility and allows us to focus on our core business.”
Craig McCaw is another key individual behind the new arrangement. He was not only chairman of the original Clearwire but he also controls ICO, the company set up originally to implement a global satellite handheld service but now poised to offer land-mobile broadband Internet access via a newly launched geostationary satellite located over the USA.
“The power of the mobile Internet will fundamentally transform the communications landscape in our country,” he said. “We believe the new Clearwire will operate one of the fastest and most capable broadband wireless networks ever conceived.”
The new business will build on Clearwire's 400,000-strong subscriber base and Sprint’s Xohm WiMAX network build-out, which started in a few markets earlier this year. It plans to offer mobile Internet services on an array of new devices and to create a network covering between 120 million and 140 million people in the USA by the end of 2010. Sprint will contribute hardware, software, all its WiMAX-related trademarks and other intellectual property, and existing infrastructure.
Intel will work with manufacturers to embed WiMAX chips into Intel Centrino 2-based laptops and other mobile Internet devices. Google will work with the new Clearwire to develop Internet services, advertising and applications for mobile WiMAX devices. It will also supply the search capability and will be a preferred provider of other applications.
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