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Sprint Nextel picks Wimax for new wireless network
Seattle Times technology reporter
After years of deliberation, Sprint Nextel has chosen to partner with Intel, Motorola and Samsung to roll out a nationwide wireless-broadband network using WiMax technology, a standard that delivers high-speed Internet access on a much broader scale than Wi-Fi.
The deal is strikingly similar to an announcement made last month by Kirkland-based Clearwire, run by wireless entrepreneur Craig McCaw. Clearwire received a $900 million investment from Intel and Motorola to help build a nationwide WiMax network, and simultaneously sold its equipment subsidiary to Motorola for an undisclosed amount.
So will Sprint Nextel and Clearwire be competitors or collaborators?
To date, the relationship between the two companies largely has been limited to swapping rights in certain markets to the airwaves required to roll out WiMax. Reston, Va.-based Sprint Nextel owns the most spectrum within a certain bandwidth, and Clearwire the second-most.
The companies say that continues to be their only connection. But with Tuesday's announcement, the two will have the same technology, the same spectrum and the same partners. At a minimum, that will generate more interest in WiMax on a global scale, creating greater demand and lower equipment prices for both. But analysts say it also could spur a deeper bond between Sprint Nextel and Clearwire.
"Obviously, by going with WiMax, they have great potential to work together," said John Mansell, a senior analyst at Kagan Research, a division of Jupiter.
Ben Wolff, who shares with McCaw the title of Clearwire chief executive, said: "I don't want to speculate what our relationship with Sprint might be. The real opportunity for both companies is to be able to benefit from the momentum. With more people moving in the same direction, all parties benefit."
Sprint said Clearwire's pact with Intel and Motorola did not influence Sprint's choice of WiMax.
"We are not privy to Clearwire's business model and, really, it has no bearing on our decision or strategy moving forward," a Sprint Nextel spokesman said by e-mail.
During a conference call Tuesday, Sprint Nextel's Chief Technology Officer, Barry West, said the ecosystem forming around WiMax was one reason why the company chose it. The backing of Motorola, Intel and Samsung will ensure that the equipment and devices are ready by Sprint Nextel's slated rollout in late 2007 and 2008.
For now, Clearwire positions its services as an alternative to DSL, rather than as mobile broadband. Its current service, a precursor to WiMax, is available in about 30 markets and requires a textbook-sized modem that must be plugged into an electrical outlet.
Although Clearwire and Sprint Nextel are targeting slightly different markets, the services are likely to converge in the next couple of years as the technology improves.
"Certainly our movement toward WiMax means we intend to take advantage of all the features and functionality," said Wolff.
Tricia Duryee: 206-464-3283 or email@example.com
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