dslreports logo
site
spacer

spacer
 
   
spc
story category
Clearwire Chairman McCaw Resigns
As Sprint considers a $200 million investment
by Karl Bode 09:13AM Monday Jan 03 2011
An SEC filing indicates that wireless sector pioneer Craig McCaw has resigned as chairman of Clearwire. The move raises obvious questions concerning the company's health, though Clearwire insists the move does not involve "any disagreements with the company on any matters relating to its operations, policies, or practices." As Clearwire tries to manage their $1.4 billion in debt, Sprint is rumored to be preparing to invest another $200 million. "At the end of the day, we believe Sprint needs to maintain a majority economic control in Clearwire," insists Kaufman Brothers analyst Ben Abramovitz.

view:
topics flat nest 

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

1 edit

Sprint needs Clearwire to maintain Wimax network

The real question is what will be the cheapest way for Sprint to keep access to Clearwire's Wimax network. Today they have a big financial stake in Clearwire plus they also pay for use of their network. Clearwire claims Sprint isn't paying its bill ontime for that access. Clearwire is broke and wants investors to kick in more money. Will they? It may be cheaper for the major investors to let Clearwire go bankrupt and then get a deal on the assets in bankruptcy court by stiffing those Clearwire owes money to.

EDIT: Sprint nixed a $760 million investment in Clearwire late this morning. »Sprint tells Clearwire no go on further investment

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Sprint tells Clearwire no go on further investment

Sprint has declined to invest an additional $760 million in Clearwire as they had the option to do and that Clearwire really needs to continue expanding their network. Game On. What will Clearwire do to salvage their company?

»technology.canoe.ca/2011/01/03/16740911.html

Sprint Nextel let a Jan. 2 deadline pass without exercising its right to buy $760 million US of Clearwire Corp convertible debt, ruling out that source of funding for Clearwire.

Sprint, which owns about 54% of Clearwire, confirmed Monday that it had opted to not exercise the right but Sprint spokeswoman Cristi Allen declined further comment.

Clearwire has said that other options for new funding could come from the sale of up to $2 billion of wireless spectrum or from an equity investment from a company such as Sprint or T-Mobile USA, a unit of Deutsche Telekom.


kapil
The Kapil

join:2000-04-26
Chicago, IL

1 recommendation

Re: Sprint tells Clearwire no go on further investment

With Comcast busy with the NBC merger, Google having had a change of heart and cozying up with Verizon and Time Warner having its own cash issues, Clear may be hosed.

Of all the Clearwire investors, Sprint needs the network to stay lit the most for obvious reasons.

Maybe Sprint's decision to pass on the additional investment is just them trying to force Clearwire into bankruptcy....then Sprint can swoop in with some Debtor-In-Possession type financing and eventually buy out the network for pennies on the dollar. This way they get a WiMax network and spectrum for a fraction of the original cost....and they can spend their own cash to continue the buildout of a 4G network.
--
»www.VoIPTrunk.com

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

Re: Sprint tells Clearwire no go on further investment

said by kapil:

Maybe Sprint's decision to pass on the additional investment is just them trying to force Clearwire into bankruptcy....then Sprint can swoop in with some Debtor-In-Possession type financing and eventually buy out the network for pennies on the dollar. This way they get a WiMax network and spectrum for a fraction of the original cost....and they can spend their own cash to continue the buildout of a 4G network.

That is what I think will happen as well.

mix

join:2002-03-19
Utica, MI

Re: Sprint tells Clearwire no go on further investment

Wasn't part of the formation of Clearwire that Sprint gave Clearwire a ton of their 2.5 Ghz spectrum? Now Sprint will have to buy that spectrum back?
LineNoise

join:2006-06-25
Downers Grove, IL

Re: Sprint tells Clearwire no go on further investment

No, Clearwire is talking about selling it to someone else.
MRCUR

join:2007-03-09
Columbia, PA
Clearwire combined its own spectrum with Sprint's Xohm spectrum.

BlahClearwir

@clearwire-wmx.net

Re: Sprint needs Clearwire to maintain Wimax network

You want to know how great Clearwire is? It took me two minutes to load this page, and all the pictures are still showing up as icons.

Go Clearwire!!!

old_dawg
"I Know Noting..."

join:2001-09-22
Westminster, MD

A million here, a million there

Sprint has no problem (and a long history of) shoveling cubic dollars into black holes. ION anyone?
--
"Our network engineers are aware of the problem..."

jmn1207
Premium
join:2000-07-19
Ashburn, VA
kudos:1

Re: A million here, a million there

I wouldn't compare ION with Wimax. ION failed because the technology did not exist to properly manage it. Sprint's Wimax, through Clearwire, is successfully being deployed now in several markets. Sprint has options to continue using Wimax, deploying LTE, or operating both, as these technologies can easily coexist.

This is not some battle between Wimax and LTE for 4G dominance, with Sprint having all of its eggs in one basket.

kapil
The Kapil

join:2000-04-26
Chicago, IL
ION was a fantastic product, technically speaking. As with a lot of things that came from Sprint, they just didn't know how to market and support it.
--
»www.VoIPTrunk.com
DarnellP

join:2004-10-12
Las Vegas, NV
said by old_dawg:

Sprint has no problem (and a long history of) shoveling cubic dollars into black holes. ION anyone?

You seem to be fond of bringing up ION. However, if Sprint had such a long history of shoveling money into black holes as you say, can't you come up with other examples? Btw, ION was shut down in what, 2001? That's dangerously close to a decade ago. Isn't it about time to let that dead horse rest in peace?
LineNoise

join:2006-06-25
Downers Grove, IL

Re: A million here, a million there

Nextel.
DarnellP

join:2004-10-12
Las Vegas, NV

Re: A million here, a million there

I guess I'm missing your meaning because the Nextel network is still alive and apparently will be until at least 2013.
LineNoise

join:2006-06-25
Downers Grove, IL
Reviews:
·voip.ms

Re: A million here, a million there

Nextel. QChat. Sprint Broadband Direct. Worldcom (Well, Almost. That was a close call).

Nextel is a black hole because they were unable to convert so many people, they failed maintaining and upgrading it and they now announced their intentions for phasing it out. Yes, it's still a few years away, but they waited way too long to shit or get off the pot on iDEN. It's sucked a lot of life out of Sprint.
DarnellP

join:2004-10-12
Las Vegas, NV

Re: A million here, a million there

The Nextel merger is what it is. I think that Alltel would have been the more logical partner, but that's water under the bridge. Bad merger or not, there are some positives that will come out of it, namely spectrum. A nice chunk of the 2.5GHz spectrum that Clearwire now has for WiMAX (and probably LTE at some point) came from the Nextel merger. Additionally, they got 14MHz of 800MHz spectrum that they will begin using to bolster their CDMA coverage. So call Nextel a black hole or whatever, but some of those assets should provide benefits long after the iDEN network is shuttered.

QChat came along with the Nextel merger. It's still being supported on the network level and there is still even QChat phone on their website, the V950. Plus Sprint plans to relaunch Direct Connect over CDMA later this year. They haven't disclosed what platform they're going to be using, but who knows, perhaps it will be the next generation of QChat. Thus, the jury is still out on that one.

Sprint Broadband Direct....it was in some ways obsoleted by EVDO and later WiMAX. Plus from what I understand, the FCC ordered Sprint to vacate the spectrum that Sprint was using for the service. What are ya gonna do?
hottboiinnc
ME

join:2003-10-15
Cleveland, OH

Re: A million here, a million there

Sprint needs to focus on getting that specturm in use that they just got from T. If they don't start using that for their actual CDMA network it will start to affect their business in a LOT of the markets. CLE being one of them. BIG dead spots in major areas.

old_dawg
"I Know Noting..."

join:2001-09-22
Westminster, MD
said by DarnellP:

said by old_dawg:

Sprint has no problem (and a long history of) shoveling cubic dollars into black holes. ION anyone?

You seem to be fond of bringing up ION. However, if Sprint had such a long history of shoveling money into black holes as you say, can't you come up with other examples? Btw, ION was shut down in what, 2001? That's dangerously close to a decade ago. Isn't it about time to let that dead horse rest in peace?

No. because that dead horse cost 5 billion, plus the Gary Forsee fiasco, started the free fall. You would have had to been there on the inside to understand.
--
"Our network engineers are aware of the problem..."
DarnellP

join:2004-10-12
Las Vegas, NV

Re: A million here, a million there

Even so, it was nearly a DECADE ago, Forsee is long since gone. What really is the point in continuing to bring up ION at this juncture?

airtouch25

join:2007-05-22
united state

I wanted DT to buy them off but....

At that frequency level the sites would have to be placed much closer together and the expense required to build out so many new sites could potentially be astronomical.

It's not impossible to do as T-Mobile already has the experience in creating dense PCS networks in metro areas but at 2.6 GHz it requires even more sites which costs lots of $$$.

But if the price is right you never know.....