The pros and cons of Clearwire

It seems like a favorite pastime among FierceWireless and FierceBroadbandWireless readers has been to bash Clearwire. (However, these days, Sprint and its woes may take the top spot.) The comments have been quite entertaining over the past few months, with several likening Clearwire to a giant ponzi scheme and others writing detailed poetry about the ship going down. So I thought it would be appropriate to put forth a pros and cons list, which should generate some lively discussion about the likely success of Clearwire. I, for the record, want to see Clearwire succeed. Competition is always good. But I also recognize the operator has some big hurdles going forward, which are heightened when the economy is a mess. So here it goes:


  • Clearwire has the backing of technology giant Intel, Internet master Google and cable operators Comcast, Time Warner and Bright House Networks. These companies are no dummies. They are forward-thinking and innovating. Intel brings WiMAX chips that go into laptops, Google brings the top search engine and the Android platform into the mix and the cable operators bring the desire to use WiMAX as a way to bolster their current triple-play offerings.
  • Sprint and Clearwire's cable investors will be deploying MVNO data services, bringing wholesale revenues to Clearwire in addition to its own efforts.
  • Clearwire's pricing plans attack DSL/cable access, existing mobile broadband services and WiFi hotspots with prices we have yet to see from wireless broadband service providers. It enables customers to use the service as both a home Internet access service and a mobile broadband service via one pricing plan. This should help alleviate the frustration surrounding poor coverage and a lack of a nationwide footprint on the mobile side as subscribers will still see the value in being able to plug in a self-provisioning modem and surf the Web from home with localized mobile broadband access.
  • We should see VoIP in the mix and other interesting service offerings such as one demonstrated at the Consumer Electronics Show last week. Clearwire demonstrated a new battery-operated router from Cradlepoint Technology that converts a WiMAX signal into a WiFi signal that can connect to as many as eight WiFi devices in a customer's home. The operator hasn't officially announced the device yet, but is expected to release the product in the coming weeks for around $125.
  • Lack of devices aren't expected to hinder the company going forward as Clearwire has key OEMs making WiMAX-enabled laptops, aircards and mobile Internet devices. It also has aggressive distribution plans that include Clearwire stores, large retailers and OEM partnerships.


  • Clearwire is cloudy about its 2009 rollout plans, leaving the market to wonder just how aggressive it is going to be and how much of a head start it is actually going to have when LTE comes to market. The company said it may slow its WiMAX deployments in response to the slumping economy.
  • Although Clearwire is getting a $3.2-billion capital investment from Intel, Google and the cable operators, additional investment will be necessary in the 2010 timeframe. Clearwire management has said that an additional $2 billion to $2.3 billion will be needed to reach positive cash flow. How much additional money will the company's investors be willing to put up? Intel and Time Warner are recording write-downs in 4Q08 related to their investments in Clearwire.
  • Coverage will be a problem for some time as Clearwire will likely not deliver a reasonable mobile WiMAX footprint in its top 200 markets until 2011 (if rollouts go as planned). It will be able to leverage Sprint's 3G EV-DO network, but it's not clear how many dual-mode devices it will be offering and whether Clearwire subscribers will be able to roam with GSM, LTE or other WiMAX networks overseas down the road. Clearwire's launch in Portland last week did not include any dual-mode devices.
  • Despite getting a head start in the 4G market, LTE operators such as Verizon and AT&T will be formidable competitors. Will Clearwire really have an advantage even if it is first?
  • Clearwire needs a strong branding message in these markets that are dominated by major mobile operators and telcos offering their own broadband services.

Gentle readers, I know this isn't an exhaustive list (That would take up too much room). So comment away. I'm looking forward to the debate.--Lynnette

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