Sprint's Divorce From Clearwire Can't Be Good For WiMax - InformationWeek

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11/9/2007
02:42 PM
Rob Preston
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Sprint's Divorce From Clearwire Can't Be Good For WiMax

Sprint Nextel says it remains "fully committed" to WiMax even though it has pulled the rug out from under the planned nationwide network that's central to its WiMax strategy. Who's in charge anyway?

Sprint Nextel says it remains "fully committed" to WiMax even though it has pulled the rug out from under the planned nationwide network that's central to its WiMax strategy. Who's in charge anyway?That's just the point: No one is. Sprint CEO Gary Forsee, one of the industry's biggest WiMax believers, resigned in September, and now the carrier has little stomach for investing billions of dollars in a technology with few other big backers outside of Intel and a handful of equipment makers. In announcing today that it's terminating its contract with partner Clearwire, a startup WiMax service provider, Sprint said it still plans to deploy a WiMax network "that will allow customers to realize the benefits of a mobile broadband Internet experience," and that it will probably work with Clearwire on WiMax blocking and tackling: roaming, frequency interference coordination, spectrum exchanges, standards development, etc. But the deal's off because the two companies couldn't resolve "complexities" associated with their letter of intent.

More likely, Sprint is having second thoughts about its ambitious WiMax commitment, especially as it searches for a CEO to replace Forsee, who left amid the carrier's sagging finances. While Sprint insists it's on track for a soft WiWax launch later this year in the Chicago and Baltimore/Washington areas and a commercial launch in 2008, in the next breath its says it's "reviewing its WiMax business plans and outlook" and will "comment further on these topics early next year."

Are CIOs counting on WiMax as their next-generation mobile application network? For most, the answer is probably -- not yet. For those banking on WiMax, better put those plans on hold.

The many paragraphs of CYA legalese that follow Sprint's announcement don't instill much faith. In them, Sprint couches its forward-looking statements about WiMax, emphasizing the uncertainties related to executing the business strategy, the costs, the potential inability of third-party suppliers to live up to their end of the bargain, the potential impact of adverse network performance, and other risks.

The legalese is reminiscent of an old Saturday Night Live sketch. Do not taunt Happy WiMax.

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