Sprint trio exit Clearwire board
Three Sprint executives have quit the board of US Wimax operator Clearwire, in a move analysts say clears the way for fresh investment.
Sprint CEO Daniel Hesse, Keith Cowan and Steven Elfman resigned from the Sprint-controlled carrier Thursday, a few days after reports revealed Clearwire was seeking additional investment to fund its next round of network build outs.
While Clearwire said the resignations were due to antitrust concerns analysts say the move is designed to make the carrier a more attractive prospect to potential investors, Bloomberg reported.
Kaufman Brothers analyst Ben Abramovitz said Sprint’s perceived stranglehold on Clearwire could have put new backers off.
Sprint holds a 54% stake in Clearwire and is entitled to appoint seven members to the operator’s 13-man board. Other investors include Comcast, Time Warner Cable, Bright House Networks, Intel Capital and Google.
The carrier met its target of signing up 2 million subscribers in 2010 by the end of the second quarter, and raised the figure to 3 million as a result.
Clearwire’s deeper problem in the long-term is the limited prospects for Wimax as a mobile technology. Because of the similarities of the Wimax and LTE core networks and air interfaces, it could possibly retrofit its network to LTE via a software upgrade.
Its net loss grew from $79 million (€58 million) in 2009 to $125.9 million in 2Q10, after a $79 million hit to cover inventory allowance increases.