Sprint Nextel (NYSE:S) has been careful not to publicly bash its WiMAX partner Clearwire (NASDAQ:CLWR), over certain hot-button issues, such as the ongoing wholesale dispute and disappointing rollout of WiMAX. But this week, the company's tone has been a bit different in that respect.
Sprint CEO Dan Hesse yesterday told the Wall Street Journal that the company expects to resolve its ongoing wholesale pricing dispute with Clearwire but said Sprint is prepared to go its own way if an agreement isn't reached.
"Our Plan A is together with Clearwire, but we do have a Plan B," Hesse told the publication. "If we don't reach agreement, we will go and do our own thing."
In late October, Sprint initiated an arbitration process with Clearwire over a dispute between the two companies regarding the money Sprint pays Clearwire for Sprint's WiMAX-capable smartphones, the HTC Evo 4G and the Samsung Epic 4G.
At the same time, a Sprint executive spelled out possible plans for a nationwide LTE network. Speaking at a Morgan Stanley Technology, Media & Telecom conference Wednesday, Steve Elfman, Sprint's president of network operations and wholesale, said that should Sprint decide to deploy LTE as part of its Network Vision network modernization project, the company could have a live LTE network this year, with nationwide LTE coverage by year-end 2013.
Elfman said Sprint wouldn't make a decision about LTE until mid-year because the company wants to establish and announce a strategy that is still being determined by the company and Clearwire.
It appears Sprint is growing impatient. These are some strong-arm tactics from Sprint and paints Clearwire, which is desperate for financing, into a corner. Sprint has made it clear that it won't provide anymore funding to Clearwire until the dispute is resolved.
Meanwhile, Clearwire's cable partners are proving to be useless. Cable partner Comcast made no mention of WiMAX during its last conference call with analysts. Time Warner Cable revealed that the company's wireless business has produced "not very impressive and pretty inconclusive" results. The company said it has 15,000 WiMAX subscribers.
Clearwire has some difficult decisions. If it fails to reach an agreement on the wholesale issue, it stands to lose out on millions of dollars every month in revenues. But then, it could also lose so much more. --Lynnette