LightSquared exodus continues: Cricket lands at Clearwire


Given that LightSquared won’t be launching an LTE network any time soon, customers that committed to buying the would-be operator’s mobile broadband capacity are looking for alternatives – and they’re landing at Clearwire. On Wednesday, one of LightSquared’s biggest gets, Leap Wireless, said it would buy future LTE connectivity for its Cricket prepaid service from Clearwire, marking the second in what will likely be many defections to the wholesale 4G carrier.

FreedomPop was the first to publicly switch allegiances, agreeing to tap into Clearwire’s current WiMAX network covering 130 million pops as well as the higher-capacity LTE network it plans to build in 2013. The biggest defection, however, is still officially on the fence. Sprint, which owns the largest stake in Clearwire, not only agreed to buy LTE capacity from LightSquared; it contracted to build its network, integrating it into Sprint’s new revamped base stations. According to a Bloomberg report, Sprint plans to officially abandon that deal this week, as soon as an imposed deadline on LightSquared getting regulatory approval expires Thursday.

As LightSquared’s fortunes have waned, Sprint, not surprisingly, has been showing a lot more love for Clearwire, and is now counting on the WiMAX wholesaler to provide critical capacity to its own future LTE service. LightSquared’s chances of overcoming government and GPS industry opposition to its plans were already slim to nonexistent. But without Sprint, LightSquared has no means of bringing a network online even if it were to get that approval.

That means we’re likely to see a lot more of LightSquared’s would-be customers knocking on Clearwire’s door. But mixing it up with Clearwire comes with its own complications. Tapping into Clearwire’s future LTE networks means getting specialty devices that can access the carrier’s variant of 4G, called time division-LTE, or TD-LTE (subscription required). Clearwire is hoping it can build a global ecosystem to support its LTE technology and bands. It has aligned itself with some powerful operators, including the world’s largest China Mobile, but those ecosystem efforts have also hit some snags. In addition, Clearwire has not revealed any plans to expand beyond its initial limited footprint, meaning any nationwide retail brand like Best Buy would have to settle for covering less than half the country.

And while Clearwire may be gaining new customers, it’s losing some key partners as industry liaisons shift. It’s key cable company investors Comcast and Time Warner Cable have latched on to Verizon’s star, agreeing to jointly sell their wireless and residential broadband services. Early backer Google hadn’t announced any plans to sell its own 4G service, but now that possibility is practically nil. According to the Wall Street Journal, Google sold off its original $500 million investment in Clearwire to Credit Suisse at a steep discount.

Tower Image courtesy of Flickr user Nikhil Verma.

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