Intel Millions For WiMAX
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Can Intel single-handedly bring WiMAX out of obscurity and onto laptops? Clearwire is hoping so.
The company will build a nationwide wireless network on $600 million from Intel Capital as part of a $900 million round of financing, and an undisclosed amount from Motorola.
The investment - the largest in the fund's history - signals Intel's commitment to creating WiMAX networks in the U.S., Intel Capital President Arvind Sodhani, said in a statement.
Intel, a long-time supporter of WiMax, is pushing for a nationwide network to increase demand for Centrino chipsets for notebooks featuring the wireless technology next year.
Motorola acquired NextNet Wireless, Clearwire's pre-standard 802.16e-2005 WiMax equipment provider, for an undisclosed sum.
WiMax, unlike Wi-Fi, uses licensed spectrum. While Clearwire, along with Sprint, owns the bulk of the wireless spectrum expected to be used by WiMax, the cash infusion could help the Kirkland, Wash.-based company acquire a wider footprint.
In June, Intel's chief technology officer told internetnews.com that the company considers WiMAX a part of its future despite a top-down review of ways to save money.
Sean Maloney, Intel's executive vice president and general manager of the Mobility Group, believes working with Clearwire and other broadband wireless providers "incredibly important" for creating the foundation for WiMAX across North America.
Building that nationwide network is the lone stumbling block for greater acceptance of WiMAX, Intel spokesperson Amy Martin told internetnews.com.
"Collaborating with Intel and Motorola significantly advances our vision for fixed, portable and mobile wireless broadband services," Craig McCaw, founder, chairman and co-CEO of Clearwire, said in a statement.
McCaw, who founded one of the country's first cellular networks which he later sold to AT&T for $11.5 billion, bought Clearwire Holding Company in 2004.
The company now offers pre-WiMAX service in areas, including California, Texas and Florida.
"These aren't the NFL cities," said Daryl Schoolar, analyst with In-Stat.
The new cash should help Clearwire buy more wireless spectrum along with increasing awareness of WiMAX in the U.S. People aren't paying attention to the technology now, Schoolar said.
While Intel calls Clearwire critical to the build-out of any WiMaX network, the analyst believes Sprint, the largest holder of WiMax spectrum, should be watched.
Sprint, which the analyst said plans to announce its wireless broadband intentions in August, is who could make WiMax take off.
Although In-Stat believes WiMAX equipment could become a $3 billion market by 2010, don't expect NextNet Wireless, Clearwire's gear-providing division, to be the go-to company for broadband wireless service providers.
That reasoning makes the sell off of NextNet to Motorola all the more understandable. Motorola, along with Alcatel and others, would likely be the providers of WiMAX equipment, according to Schoolar.