A T-Mobile Clearwire combination is rumored with the resignation of Sprint CEO Dan Hesse and two others likely to ease antitrust concerns.
Will T-Mobile and Clearwire link up? That's the question being asked Friday after the surprise resignation of three Sprint Nextel directors including CEO Dan Hesse from Clearwire's board; Sprint's networks executive, Steven Elfman, and strategy chief, Keith Cowan, also resigned. Sprint still retains controlling interest in Clearwire and the resignations could clear the way and likely eliminate antitrust problems so T-Mobile could link up with Clearwire.
All three companies -- Clearwire, Sprint Nextel and T-Mobile -- need more capital for growth and some sort of combination involving all three could be in the works. T-Mobile and Sprint-Clearwire have been talking for months.
Sprint and T-Mobile USA are the third and fourth largest U.S. mobile phone carriers respectively and, thus, the most likely to combine. Verizon Wireless and AT&T are the largest and second largest mobile phone carriers. Verizon Wireless and AT&T are too large and would likely have regulatory problems in any attempt to link with Clearwire.
Spectrum issues are also important. Virtually all carriers plan to eventually move to LTE. Verizon is close to announcing its LTE network in 25 to 30 U.S. cities, AT&T plans to launch its LTE network next year and Sprint is testing TD-LTE in Arizona. T-Mobile, too, is expected to eventually move to LTE.
Sprint, which owns some 54% of Clearwire, would have to reach agreement with other Clearwire investors including Intel and Comcast before any deal could be consummated with T-Mobile.
Clearwire's WiMax infrastructure is unlikely to be a big hurdle as the firm has said it won't be a difficult task to move to LTE. Qualcomm has been demonstrating TD-LTE products for the China and India markets, and the products could provide a bridge between WiMax and LTE. Qualcomm's Cristiano Amon, senior vice president of Qualcomm's CDMA Technologies' Cellular Products Group, recently said Qualcomm is expected to bring TD-LTE products to market next year.
In the meantime, Clearwire is without three directors and the mobile wireless world is waiting for some additional shoes to drop.
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