MuniWireless

There was no shortage of headlines after the historic May 7 announcement of the joint venture and $3.2 billion in funding that formed the “new” Clearwire, and its plans for a nationwide WiMax network. But in the course of putting together our comprehensive research report on the topic, we uncovered several interesting factors you may not have heard about, in regards to both the big new investors — Google, Comcast, Intel and Time Warner Cable — as well as Clearwire’s top competitors, AT&T and Verizon.

In no particular order of importance, here’s our list:

1) The new Clearwire network will use the “mobile” version of WiMax.
There seems to be a lot of confusion around this point, mainly because the “old” Clearwire had been using a so-called “fixed” version of the wireless broadband technology in the networks it’s been building since 2004. The new networks (including those inherited from Sprint’s Xohm operations) will use equipment based on the newer, mobile standard, which supports cellular-like roaming. Clearwire had previously said it was upgrading its networks to Mobile WiMax anyway, so this is not a big change. But when the mobile gear goes live, it will offer a much different experience than previous WiMax deployments.

2) Despite its stated strategic direction toward the long-term evolution (LTE) 4G cellular technology, AT&T currently runs several commercial WiMax networks in the U.S., in Nevada, Alaska and other locations.
Right now there doesn’t seem to be too much to look into here, except for the fact that AT&T may be hedging its bets by keeping its toes wet in matters WiMax. This may be more important in the future, when WiMax standards at the 700 MHz level emerge.

3) There is more bandwidth currently available at WiMax’s main frequency than at the much-heralded 700 MHz band.
This point is a hard one to make, since most people talk about the characteristics of specific spectrum slices, like the ability of 700 MHz signals to penetrate building walls. But when it comes to being able to offer more bandwidth to more folks, the amount of available spectrum may matter more — and right now, there is about 198 MHz available at WiMax’s 2.5 GHz band, as opposed to 60 MHz that is being freed up at 700 MHz. So WiMax may be better able to scale to support more users.

4) WiMax mobile devices are already under development, and should be ready about the same time the Clearwire network launches.
There’s a bit of a trust factor involved here, but we are going on the research we did with Sprint, who said that they had more devices in their labs for testing than they had time to certify. And the debut of Nokia’s WiMax tablet at CTIA in April seems to show that device manufacturers are ahead of the curve here.

5) The new Clearwire will offer day-pass and casual-use billing, which is a departure from the past long-term contracts.
Because Clearwire doesn’t have to subsidize the costs of all the expected WiMax-enabled devices, it can offer ad hoc contracts without the worry or expense of paying for end-user equipment. While it may take a while for Wall Street to wrap its mind around “occasional ARPU,” the incremental adds should bolster, not detract from, a provider’s bottom line.

Paul Kapustka is the editor of Sidecut Reports, which has recently published an updated report on the state of WiMax deployments in the U.S., focusing on the new Clearwire deal.