Thursday, December 4, 2008

XOHM and Clearwire merge to form larger WiMax company

I love wireless. Let's face it, who wants more wires in their lives? I especially like wireless broadband. I'd be completely lost on the road without my Sprint Sierra Wireless Broadband USB dongle. But I'd like to have WiMax even more. That's 4G as in 4th generation wireless.

To that end, I've been following the Spring product XOHM with interest for some time. The idea of readily available broadband wireless is really intriguing. I just got word yesterday that Sprint and Clearwire have merged their initiatives on this project. Here is the press release:

Combination of Sprint and Clearwire's WiMAX Businesses with $3.2 Billion Cash Investment from Comcast, Intel, Time Warner Cable, Google, and Bright House Networks Creates New Opportunities for Next-Generation Services

Clearwire Spectrum Holdings to Enable Unmatched Wireless Network Capacity for Broadband Services

Clearwire's Mobile WiMAX Services to be Branded "Clear"™

Clearwire Corporation (NASDAQ: CLWRD for the first 20 trading days and CLWR thereafter) today announced that it has completed the transaction with Sprint Nextel Corporation (NYSE: S) to combine their next-generation wireless Internet businesses. The new company retains the Clearwire name and expects to build the first nationwide 4G mobile broadband network focused on meeting the evolving needs and demands for Internet-based communications services. In addition, Clearwire has received a $3.2 billion investment from Comcast, Intel, Time Warner Cable, Google and Bright House Networks. The transaction with Sprint and the new cash investment were completed on the terms originally announced on May 7, 2008.

"As we roll out our network across the country, people will no longer have to make the choice between speed and mobility. We are bringing a new mobile Internet experience to customers at speeds previously relegated to fixed locations," said Benjamin G. Wolff, chief executive officer of Clearwire. "With significant spectrum holdings yielding unmatched network capacity, a next-generation all-IP network, and an open Internet business model, Clearwire will deliver a simple value proposition aimed to improve productivity and make the Internet experience more enjoyable, wherever our customers happen to be."

"With the global economic challenges ahead for consumers and businesses next year, we believe it's important to invest in those infrastructure improvements that can propel the U.S. forward and stimulate innovation,” continued Wolff. "Today is just the beginning. Over the coming years, as Clearwire rolls out ultra high-speed mobile Internet services across the country, we expect to be well positioned to transform the communications landscape."

Clearwire Chairman, Craig O. McCaw said, ”This is not simply about a time-to-market advantage, but about having an amazing block of spectrum that is unencumbered by legacy commercial uses and technology. It is a chance to do something right the first time, with simplicity and incredible efficiencies. We are building a wireless broadband network that will stand the test of both time and competition. This is far and away the most exciting opportunity in wireless I have seen since the beginning of cellular in 1983."

"This is the beginning of a new chapter in wireless that leverages Sprint’s investment in 4G to profoundly change how people and businesses send, receive and use information,” said Dan Hesse, chief executive officer of Sprint and member of Clearwire’s Board of Directors. “As the largest shareholder in Clearwire, Sprint is uniquely positioned to provide customers with both the largest and most dependable 3G network in America and access to the nation’s first 4G mobile broadband network."

New Investors

Clearwire received the $3.2 billion investment from some of the most innovative communications, entertainment, and technology companies in the world, including: Comcast, Intel through Intel Capital, Time Warner Cable, Google, and Bright House Networks, and, as previously announced, will receive an additional investment from Trilogy Equity Partners in the coming months.

Brian L. Roberts, chairman and chief executive officer of Comcast Corporation said, "We look forward to providing our customers with exciting high speed mobile products. Our customers want access to the most innovative products both in and outside the home. With our new partners, we will deliver integrated mobile high speed Internet products for years to come."

"Clearwire represents a significant move forward for 4G wireless technology in the U.S.," said Paul Otellini, Intel president and chief executive officer. "WiMAX is the right combination of industry leaders and technology needed to meet the growing demand for more powerful, flexible mobile broadband solutions today. The investments made by Intel Capital around the globe demonstrate our continued commitment to redefine the way people enjoy the Internet on the go."

Glenn Britt, president and chief executive officer of Time Warner Cable said, "We connect our customers with entertainment, information and each other; any time, anywhere, on any device. Our investment in Clearwire will help us further that goal by adding value and creating a seamless Time Warner Cable experience."

"People should be able to access the Internet anytime, regardless of where they are or what device they choose to use," said Eric Schmidt, chief executive officer and chairman of Google. "We are pleased that Clearwire's mobile WiMAX network will soon offer high speed broadband that will allow subscribers to be online in a greater number of places and on a larger variety of devices."

Robert J. Miron, chairman of Bright House Networks said, "Bright House Networks is proud to join this strong set of partners in Clearwire. We are enthused to be part of this advanced 4G wireless deployment bringing subscribers the highest throughput mobility solution on the market today."

Spectrum Yields Unmatched Wireless Network Capacity

Clearwire’s open all-IP network utilizes mobile WiMAX technology, providing customers with average download speeds initially of 2-4 megabits per second and peak rates that are considerably faster. However, the company noted that its spectrum holdings are what provide Clearwire with real differentiation in that it enables the company to provide true, mobile broadband services. At the closing, Sprint contributed its entire 2.5 GHz spectrum holdings to Clearwire. With this combined spectrum portfolio, Clearwire now has 100 MHz or more of optimal 4G spectrum in most markets across the U.S.

"In the landline world, service providers can’t deliver broadband without a big enough ‘pipe,’ and in the wireless world that means having enough of the right kind of spectrum,” continued Wolff. “Our significant spectrum holdings provide Clearwire with unmatched, dedicated network capacity for data services that will enable us to deliver true, mobile broadband services in ways never before possible.”

Let's Be Clear

The company also announced today that, while its company name will remain Clearwire, its new mobile WiMAX services will be branded Clear™. The Clear™ brand will apply to all new mobile WiMAX services to be offered by Clearwire in the U.S. and will be phased in to those markets where Clearwire offers pre-WiMAX services, as these existing markets are upgraded to mobile WiMAX technology.

In the coming months, the Clear brand will replace the XOHM service name previously used by Sprint Nextel in the Baltimore, Md. market. Clearwire expects current XOHM customers will not experience any impact as a result of the transaction, and they will continue to enjoy the current benefits of various notebook computing, portable multimedia and Internet devices, service plans and features.

In addition, the company unveiled a new marketing tagline, "Let's Be Clear," that will be used in conjunction with the new Clear service brand in upcoming market launches. The new marketing efforts will clearly communicate the service’s unprecedented combination of speed, mobility and simplicity.

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