Sprint, Clearwire Join for WiMax Venture

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Sprint and Clearwire have agreed to form a joint venture that will bring wired broadband speeds to mobile users starting as early as late 2008. The new venture combines all the spectrum licenses owned by the two companies into a new firm called Clearwire; Sprint will retain its cellular business and third-generation (3G) data network. The new venture is valued at an estimated $14.5 billion, which includes an infusion of over $3 billion in cash from Google, Intel, and several cable operators.

Both companies had separately charted paths to roll out mobile WiMax, a flavor of mobile broadband that's only been deployed in scattered places around the world, and is about two years behind earlier predictions for widespread deployment. The technology isn't monolithic like Wi-Fi, where all Wi-Fi devices are supposed to work together (more or less). Rather, there are many flavors of WiMax, including ones that can carry 10 to 20 Mbps downstream.

Sprint and Clearwire's WiMax rollout will likely offer speeds well above 5 Mbps; some reports put the peak rates at 8 to 15 Mbps, which is perhaps optimistic for an individual user, but might be reasonable for a pool available to all users in a given "cell" of coverage. Pricing isn't set, but Sprint expected to have production networks in place this summer, which was delayed to fall, ironically because they lack enough network backhaul to carry the high-bandwidth service from their cellular base station towers!

The joint venture and Sprint have both signed deals with all the various partners, which will allow Sprint to resell WiMax access, and the new Clearwire to resell 3G service on Sprint's existing network. Cable operators will be able to resell Sprint voice, 3G, and WiMax, which allows them to have a quintuple play (voice, data, and video over cable, plus mobile voice, and mobile data). Intel and Google have an option to resell service if they choose.

We'll start seeing WiMax adapters everywhere by 2009. Intel has been a backer of WiMax since they decided that existing cellular 3G plans wouldn't accomodate their needs as early as 2004. They will build Centrino designs that have WiMax and Wi-Fi built in. Companies like Motorola, Samsung, Zyxel, and others are committed to building residential and business fixed receivers, and laptop and desktop adapters, like PC Cards and ExpressCards.

The new operation estimates that 120 to 140 million people will be able to get their service by 2010, at which time AT&T and Verizon should start rolling out their 4G flavor, LTE (Long Term Evolution), which should offer comparable speeds. This increased competition among mobile broadband coupled with true broadband speeds that compare to today's wired services should force real price competition and improved customer service.Ã ï ½

Some laptop adapters will support both Sprint's current 3G service and Clearwire's 4G WiMax, allowing the fastest speeds as the WiMax network is built. Without dual cards and the cross-selling deals between Sprint and Clearwire, WiMax would likely never have had a chance in the U.S.

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