Clearwire To Test LTE 4G Network

Hedging its bets on competing 4G networks, WiMAX vendor Clearwire plans to start testing this year LTE technology.

The company, which has been the biggest champion of WiMAX as the next-generation wireless networking technology in the U.S., said Wednesday that it would test Long-Term Evolution technology alone and in "multiple coexistence scenarios" with WiMAX.

In announcing its LTE plans, Clearwire said that despite its ongoing push to spread WiMAX across the United States, the company is "technology agnostic."

"Ultimately, consumers don't care about technical acronyms, but they do care about quality and affordable Internet services that work where and when they want, and that's what we're focused on delivering," John Saw, Clearwire's chief technology officer, said in a statement. "Part of our technical due diligence at Clearwire is to be prepared to leverage a number of possible opportunities as we future-proof our network, and that's the goal of these tests."

Clearwire plans to start the tests in the fall in Phoenix, Ariz., with Huawei Technologies, a Chinese telecommunications equipment maker that deployed the first commercial LTE network in Europe. The first-round of tests are expected to run through early 2011.

Clearwire said the tests would be conducted on the 2.5 GHz - 2.6 GHz spectrum band, which is widely used by wireless operators around the world. As a result, a number of large carriers are expected to participate in the tests, and Clearwire said it would disclose details at a later date.

"The 2.5 GHz spectrum band is universally allocated for global 4G deployments, so it has the potential to create one of the world's most robust ecosystem across billions of devices," Saw said.

During the tests, Clearwire expects to be able to produce real-world download speeds ranging from 20 to 70 megabits per second. While it tests LTE and LTE/WiMAX configurations, Clearwire said it would continue deploying WiMAX alone.

Clearwire offers WiMAX services in some 36 cities, and expects to add two dozen more by the end of the year, including New York, Los Angeles, San Francisco, Boston, Denver and Miami. The company plans to cover 120 million Americans by the end of the year, or about a third of the population.

Among U.S. carriers, Verizon Wireless has been the most aggressive in developing LTE. The company plans to deploy LTE networks in 25 to 30 cities this year, placing it well ahead of Clearwire in its efforts. Verizon expects to have nationwide coverage by 2015.

Clearwire's latest announcement is not a surprise. The company, which counts Sprint Nextel as a 51% shareholder, has indicated for quite awhile that it would not take sides in the two technologies. In September 2009, Clearwire Chief Executive Bill Morrow told Dow Jones Newswire that the company's equipment was flexible enough to shift between WiMAX and LTE relatively easily.

"We're the only carrier that can do this," Morrow said. "We'll do what's right for the business. Whether it's LTE, WiMax, future technology X, it doesn't matter to me."

Meanwhile, Clearwire reported Wednesday that it ended the second quarter with 1.7 million subscribers, consisting of 940,000 retail subscribers and 752,000 wholesale subscribers. The company added 722,000 net new subscribers in the quarter, with the vast majority -- 595,000 -- wholesale additions. By the end of the year, Clearwire expects to have 3 million total subscribers.

At the end of the quarter, Clearwire's WiMAX network covered about 56 million people in the U.S.

The company also reported that revenue rose 93% in the quarter to $122.5 million from $63.6 million the same period a year ago. Net losses rose to $125.9 million, or 61 cents a share, compared to $73.4 million, or 38 cents a share, a year ago.