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Clearwire: We Don't Need No Stinkin' LTE

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Clearwire (s CLWR) CEO William Morrow, on his first conference call yesterday, did several things right. He toned down the first-mover advantage statements regarding Clearwire’s WiMAX technology and rival fourth-generation wireless technology, LTE, and instead focused on the capacity and openness of the WiMAX network. He pointed out that WiMAX offered a way for customers to get streaming video or other applications that carriers are currently leery of. He also was emphatic that even though LTE and WiMAX are similar, Clearwire isn’t planning on dumping WiMAX in favor of LTE anytime soon:

If it ever comes to, and I think this was stated in the past, I mean, much into the future, if economies of scale ever get to the point to where it’s advantageous for Clearwire to be also propagating LTE and offering LTE-type technology to its end users, then of course we can do that.

As Dr. Saw has kind of said, I think in the past to many of you, there is an architecture that is IP, that is independent as to whether it is LTE or WiMAX, and we have the ability to add that. Obviously, there would be some cost in it. We don’t think at this point there would be any sort of write-off of the WiMAX because again, it’s going to have a life of its own and be able to sustain itself.

Plenty of people believe WiMAX has a place in this world, and most of them are not on the carrier side. However, as the PC makers and the rest of the technology industry infiltrate the wireless market, Clearwire’s bet on the more open WiMAX technology may pay off. So far, the take-up rate for WiMAX in the few cities where it has launched has looked good. Clearwire added 25,000 new subscriptions this quarter, and users in Portland, Ore., where the service launched in January, are using twice the bandwidth than those in Clearwire’s Pre-WiMAX markets.

10 Responses to “Clearwire: We Don't Need No Stinkin' LTE”

  1. device may not be that important other than laptop usb dongles. regular old laptops are definatly the ‘killer app’ where wimax technology will have an advantage over LTE.

    • Jesse Kopelman

      The problem is that without a halo device you have to compete on price. Being heavily loaded with debt and trying to compete solely on price is a recipe for disaster. Look at AMD’s current state. Look at Sprint’s current state. If WiMAX had actually been rolled out on schedule by Sprint/Clearwire, 2 years ago, things would be different. They would have the competitive advantage of having a much faster network. At this point, they gone from being nearly 3 years ahead on the network side to less than a year. Couple that with the ability of carriers like AT&T and Verizon to finance a very rapid buildout and where does that leave Clearwire? They need the Halo device to bring in the high ARPU subscribers, which in turn will allow them to borrow the money they need to rapidly build out their network and maintain their technical lead. These things are all connected.

  2. tvlampsn

    Clearwire is also expanding (or trying to expand) really quickly in Atlanta. Being able to get internet + phone for $55 is pretty nice. Especially since it’s “for life.”