The world finally knows how many mobile WiMAX subscribers Clearwire has.
The operator had previously indicated it wasn't ready to break those numbers out from its pre-WiMAX subscribers, but now that it is operational in 13 markets, the operator apparently felt comfortable announcing 173,000 mobile WiMAX subscribers at the end of the third quarter. Still, it's unclear just how many mobile WiMAX customers were added in the third quarter. Clearwire recorded a total of 44,000 net subscriber additions in the quarter, surging up from 8,000 in the year-ago period. The company had a total subscriber base of 555,000, up 18 percent from the year-ago period and up from 511,000 in the second quarter.
Clearwire CEO Bill Morrow told analysts during the company's conference call that it was safe to assume the net additions would have been much higher if it hadn't been for the defections of pre-WiMAX subscribers. The operator has ceased marketing efforts around pre-WiMAX offerings, putting its full focus on mobile WiMAX.
Another big question is how many of those are wholesale--coming from Sprint, Comcast and Time Warner--and how many are a result of Clearwire's marketing efforts. Morrow said the company wasn't ready to break those numbers out quite yet.
"It's still a little bit too early," Clearwire CEO Bill Morrow said in a response to a question during its third-quarter conference call. "We will be breaking this out in the future, sometime next year. We want to do it as early as possible. We'd like things to stabilize a little bit so you can use it as a predictive model."
Another interesting trend Clearwire revealed had to do with the type of data usage it is seeing among mobile WiMAX operators. In converting pre-WiMAX subscribers to mobile WiMAX, Morrow said the company sees in general a doubling of data consumed.
"...This just proves the theory that if a customer is given a better experience with speed, those applications are more meaningful to them and they consume more data as they go forward," Morrow said. "So right now, we are seeing that on the average of about double."
Clearwire posted a loss of $82.42 million, wider than the loss of $7.2 million in the year-ago quarter. Revenue rose 13 percent to $68.8 million in the quarter. Its average revenue per user was $39.71, down from $40.43 in the third quarter of 2008, and up slightly from $39.57 in the 2009 second quarter. The company said that the decline in ARPU on a year-over-year basis was due to increased promotional discounts as a result of higher gross subscriber adds.
In related news, Clearwire confirmed it will be receiving more than $1.5 billion in additional funding. Sprint, which holds a majority percent ownership stake in Clearwire, will contribute the most new funding, with equity financing of $1.176 billion. Comcast will contribute $196 million, Time Warner Cable will add in $103 million, Intel will contribute $50 million, Eagle River will chip in $20 million and Bright House Networks will provide $19 million. Clearwire also said that equity investors have committed approximately $240 million in debt funding.
Noticeably absent from the group of investors is Google, which was part of the group of investors that provided Clearwire with $3.2 billion in funding last year. Google said it will not be providing new financing, and that it could best help the company by working with it on products and strategy. Morrow dismissed concerns about Google's lack of funding support. "Google believes in us and they are supporting us from a product management and strategic point of view," he said. "I wouldn't read anything negative into that whatsoever."
- see this Seeking Alpha transcript
- read this FierceWireless article
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