Pressure from investors is causing Sprint executives to rethink its ambitious WiMAX broadband network. According to the Wall Street Journal, the company may form a partnership or joint venture with Craig McCaw (who founded wireless Internet firm Clearwire in 2003) and seek cash from cable providers. Sprint has said it will spend $3 billion on WiMAX through the next year.
The article also says that Sprint Chairman and CEO Gary Forsee said Sprint may consider spinning off the WiMAX unit. It's speculated that a spinoff may be part of a deal with McCaw's Clearwire, which currently has about 258,000 customers in 38 U.S. markets. A deal with Clearwire would give Sprint access to more spectrum in some key markets such as Miami and Atlanta. At the least, the two companies are likely to form some sort of roaming arrangement.
Of course, if Sprint seeks an influx of cash from its friends in the cable business (Sprint currently has a joint venture with four cable companies, called Pivot, [1] that allows cable operators to offer wireless services in their markets), it will likely guarantee the cable companies some sort of access on the WiMAX network. The cable MSOs have long been looking for an avenue into the wireless [2] arena. A deal like this may be a logical step for them. However, there is still a lot of speculation about the nature of the next play in the converged cable/wireless world. In October 2006, the cable JV announced that it had won 137 wireless licenses for $2.37 billion in the AWS auction. Since then there has been no word on what they plan to do with that spectrum.
For more details:
- see this WSJ article [3] (sub. req.)
Links:
[1] http://www.fiercewireless.com/story/editor-s-corner/2007-02-23
[2] http://www.fiercewireless.com/story/cable-operators-look-at-more-ways-to-enter-wireless/2006-02-27
[3] http://online.wsj.com/article/SB118177984718034661-search.html?KEYWORDS=sprint&COLLECTION=wsjie/6month