Clearwire looks to white space for savings
New network approved, needs paying for
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While the white space vote might have got all the attention last week - along with that other vote - the FCC also approved the creation of "New Clearwire" and it turns out that the two votes could well prove complementary.
The vote was passed 5-0 and will allow Google and friends - including Time Warner, Comcast, and Intel - to pour their $3.2bn into the venture and take 22 per cent of the company. That leaves Clearwire shareholders with 27 per cent and Sprint Nextel with a controlling 51 per cent ownership.
But even that infusion of cash isn't going to be enough to build the 140 million points of presence New Clearwire is expected to need for national coverage. That's going to set the company back another $2.5bn at least - possibly a lot more, which explains the sudden interest in white space spectrum.
"I think that presents some interesting opportunities for us, and we'll be looking at how we might leverage it in the rural areas," said CEO Benjamin Wolff, in a conference call following the filing of Clearwire's Q3 results, as reported by Information Week. This fits in well with how Motorola sees white-space spectrum being used: medium-distance fixed connections for telco backhaul, rather than the "Wi-Fi on steroids" that some have been promoting.
Clearwire has been running fixed WiMAX services in Baltimore and has been testing mobile WiMAX in Portland. The roll-out is already knocking half a million subscribers thanks to another 8,000 signing up in the last three months - during which it managed a loss of $166m against a revenue of $60.8m.
That Portland, Oregon deployment should be demonstrating the in-building penetration of the technology, though public technical evaluations will have to wait until next year when the service goes commercial. Clearwire is operating around 2.5GHz, which has real trouble getting through walls despite the ways in which the WiMAX protocol attempts to mitigate.
Deploying a national network won't be cheap, and it's not a good time to be raising capital - but this is a long-term investment that will have to outlast the current economic strife. Intel will make sure there are plenty of WiMAX laptops knocking around, and the first WiMAX handsets are already emerging. Clearwire's problems will be building penetration and the cost of rolling out - both areas where white space could offer some relief, assuming that white-space devices end up working at all. ®
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COMMENTS
White space = space whited out
The Commission's approving widepread use of spectrum temporarily or locally unoccupied has probably halted TV broadcast expansion in the United States. One need not expect FCC assistance in relief from interference; just look at its cheerleader attitude to BPL (PLT).
A few details
Just some clarifications....
All of Clearwire's commercial networks thus far have been based on a fixed 'pre-WiMAX' OFDM technology that they've deployed in many areas across the US (http://www.clearwire.com/store/service_areas.php).... but the Baltimore area is not one of them.
Clearwire has started building true WiMAX networks (802.16e, the 'mobile' variety) and is close to bringing at least one or two of those into commercial service soon.
What *is* in Baltimore is Xohm's 802.16e network. Xohm, of course, is Sprint's WiMAX unit that is slated to be combined with Clearwire if/when the New Cleawire deal is consummated.
The article's point- drawing a line between the FCC's recent whitespace ruling and the new Cleawire- is interesting. Any successful 3.5G/4G deployment needs to address the issue of backhaul and in the US, particularly in the rural US, cost-effective backhaul is a huge challenge.
It just so happens that a few years ago Motorola acquired a UK company, Orthogon that specializes in.....wait for it....smartish point-to-point backhaul radios that can operate in licensed or unlicensed spectrum bands. The whitespace ruling might open a new swath of bandwidth that could help solve the next-gen backhaul bandwith problem. Motorola certainly won't be alone in hawking point-to-point radios but it does provided a cross-selling opportunity as they sell both the point-to-point radios and WiMAX kit.
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