Blog Post

Clearwire Shouldn't Count on Stimulus

Clearwire (s CLWR) announced a slightly scaled back rollout of its WiMAX network last Thursday, but analysts still believe the wireless operator will have to stretch itself to pay for its nationwide network. Chris King, a analyst at Stifel Nicolaus, thinks Clearwire will need $2 billion to $4 billion more than it has disclosed to build out its nationwide network.

Last week, Clearwire said it will launch its WiMAX network in Seattle, Atlanta, Chicago, Dallas, Las Vegas, Philadelphia, Honolulu, and Charlotte (N.C.)  later this year. Boston, Houston, New York, San Francisco, and Washington, D.C. are coming in 2010. We weren’t too far off, it seems. But Cleawire will eventually need more cash to continue its plans.

There’s still the difference between the $3.2 billion Clearwire has from its deal with the cable guys, Google (s GOOG) and Sprint (s S), and the $2-4 billion it will need to build out a nationwide network. With the economy in a freefall, that gap may be hard to fund, slowing deployments further. Clearwire CEO Ben Wolff said the company plans to seek funding from the $7.2 billion allocated for aiding broadband deployment in the recently passed stimulus bill.

However, much of that money is aimed at building out rural broadband, which means Cleawire could use it to expand coverage into areas near its big -city deployments. However, it would likely have trouble getting significant dollars from the program to offset its capital gap. So, the race to nationwide 4G could still go to the carriers deploying Long Term Evolution, or LTE.

4 Responses to “Clearwire Shouldn't Count on Stimulus”

  1. Let me tell you something here:

    Comcast has so alienated its user base out here in MA, that if any wireless Broadband provider had any decently priced alternative to cable, I would try it in a New York Minute.