Sprint Nextel (NYSE:S) CFO Joe Euteneuer said the carrier has not yet decided whether to give Clearwire (NASDAQ:CLWR) more funding, but hinted that the company is moving toward deploying LTE via its Network Vision network modernization project.
The Sprint finance chief, speaking at the Barclays Capital Global Communications, Media and Technology Conference, said he is glad Sprint and Clearwire have resolved their wholesale funding dispute, which will see Sprint pay Clearwire $1 billion through 2012. He said Sprint, which holds a 54 percent stake in Clearwire, went with Clearwire's mobile WiMAX network because it provided a first-mover advantage, but he said Sprint is now thinking ahead to the future.
Sprint is "positioning itself through Network Vision to what I'll call next generation," he said. Sprint has consistently said it will provide clarity on its 4G plans by mid-year and speculation has centered on a switch to LTE. Euteneuer, who joined Sprint this spring, said before he joined Sprint he looked at Clearwire and thought "it was a little amazing that they were so off course and not leveraging one of their largest shareholders." Clearwire's difficulties, coupled with the wholesale dispute, forced Sprint to think of ways it could streamline its cost structure, which led to Network Vision, he said.
Clearwire COO Erik Prusch said last week the company will eventually switch to LTE network technology, but declined to say when the switch will happen--and warned the plans are not definite. "WiMAX to date has been a very good technology choice for us," he said in an interview with Cnet. "We were able to take advantage of the speed to market before LTE was even a glimmer in anyone's eye. But we recognize the ecosystem in the U.S. will be larger for LTE than WiMAX, so we are conscious of that."
Euteneuer said Sprint remains focused on reducing churn and growing its subscriber base as it moves to consolidate gains it has made in recent quarters in the postpaid market. He said regardless of whether AT&T's (NYSE:T) proposed $39 billion acquisition of T-Mobile USA goes through, "the best thing we can do is really focus on execution. Execution cures all ills."
Interestingly, Euteneuer also said Sprint is open to potentially working with a major wireline player to better compete against AT&T and Verizon (NYSE:VZ) in markets in which they offer quad-play service. The Sprint exec did not mention any specific companies, but recent speculation has centered on CenturyLink as a possible buyer of Sprint. Euteneuer was formerly Qwest's CFO; Qwest was recently acquired by CenturyLink.
"Our focus now is on the integration of Qwest and the acquisition of Savvis," CenturyLink CEO Glen Post said last week in response to rumors of CenturyLink buying Sprint. "We're not looking to go after anything big right now."
- see this Dow Jones Newswires article (sub. req.)
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