Sprint-Clearwire deal paves way for WiMax
Published 5:00 am Thursday, May 8, 2008
CHICAGO — By year-end, the launch of the next generation of wireless networks is expected, blanketing initial service areas with a fast Internet signal — accessible to subscribers from homes, streets and traveling vehicles — and capable of giving mundane home appliances a voice.
In this Jetsonian vision of life, which could take several years to arrive fully, a washing machine embedded with a wireless chip would detect a problem and contact the manufacturer even before the homeowner knew something was wrong with the spin cycle.
The wireless breakthrough, known as WiMax, was dreamed up over the past few years and then beset by financial worries. It was revived Wednesday in a sweeping deal between Sprint Nextel Corp. and Clearwire Corp. that also includes some of the biggest names in technology, including Google Inc., Comcast Corp., Intel Corp. and Time Warner Cable Inc.
The presence of marquee supporters signifies the industry view that the new technology eventually will bring together phone calls, Web access, radio and even television, pushing all of this content through one high-speed pipe and making it fully portable.
As analysts see it, a fast signal available everywhere would break down the traditional barriers between devices and content providers and, for example, allow a consumer to watch a TV program on a conventional set, a phone or a laptop computer, either at home or on the go.
This convergence promises to heighten competition between different players, theoretically pitting cable companies against mobile phone operators and Internet service providers for all types of communication and data transmission because each would be able to offer high-speed connectivity for home and mobile phone service, Internet access and video service.
The presence of Google is one clue to the deal’s scope. The Internet giant, one of the most aggressive players in the Internet age, already is getting into the mobile phone arena, developing its own software in partnership with other companies.
Transformative deal
The new WiMax venture combines Sprint’s wireless broadband business with Clearwire in a new company valued at around $14.5 billion, with $3.2 billion invested by Google and the others.
Announcing the WiMax deal, Clearwire Chairman Craig McCaw said, “The power of the mobile Internet, which offers speed and mobility, home and away, on any device or screen, will fundamentally transform the communications landscape in our country.”
Chicago is at the center of the action partly because a major WiMax equipment supplier is Schaumburg, Ill.-based Motorola Inc. When Sprint and Clearwire started working together, they made plans to roll out the service first in Chicago as well as Baltimore and Washington, D.C. Sprint continued to conduct a limited trial in Chicago even when funding problems derailed the previous agreement in November.
Sprint executives say the Chicago network will come online by year-end. According to Motorola, the coverage area spans Gary, Ind. to Rockford. A national rollout is in the picture, with the new Clearwire aiming to reach 140 million subscribers by 2010, as long as funding materializes.
The new Sprint-Clearwire deal means “that the service will be available on a wider basis sooner around the rest of the country,” said Barry West, Sprint’s chief technology officer. “And obviously, having Comcast and the other partners in there means they can start offering services, like home entertainment services, much sooner than if they were building their own network.”