Clearwire. Clearwire. Clearwire! Clearwire!!! And Dan Hesse wakes up.
Clearwire has often been the bain of Sprint’s existence. Once hopeful adopted child. Then run amok with its own plans, disregarding everything its Daddy taught them. And then prodigal child returning home. And now Clearwire is out of wireless rehab with its new CEO Eric Prusch and trying to get things turned around. And its future is looking more promising than its past.
Come on? Really? An iPhone that runs on Clearwire? Stop joshing me…
Clearwire is attempting to get its LTE feet under them and transition into a high performance TD-LTE network from its previous 4G WiMax attempt. This is seen as very good news to most. Now there are even rumors of a chance to host the new LTE iPhone that’s anticipated.
Is it possible the next iPhone LTE could support Clearwire’s TD-LTE network? Clearwire CEO Eric Prusch told CNET that there would be no inherent difficulties for Apple to include support for its TD-LTE network in the iPhone 5 LTE. Prusch stopped short of saying whether he knew that the next iPhone would support running on Clearwire’s upcoming network. Of course Sprint and Apple have declined to comment.
Sprint and Clearwire are collaborating to seamlessly integrate Sprint’s FD-LTE network with Clearwire’s TD-LTE network. There are several chipsets on the market that support both together, and more expected. This coming together in a new iPhone LTE product is now becoming more plausible.
TD-LTE is gaining deployment momentum globally
Clearwire isn’t going it alone this time with TD-LTE. They certainly weren’t the only WiMax adopters in the world, but in the American wireless industry they sure felt like odd ducks on their own. This time, Clearwire is working together with several TD-LTE carriers internationally in the GTI (Global TD-LTE Initiative). Most notably, China Mobile.
China Mobile is rapidly building out its first 20,000 TD-LTE sites this year. China Mobile and Clearwire are working together to ensure interoperability between the networks. TD-LTE networks are also under way in India and Japan this year. More to follow.
A majority of new LTE deployments slated to start in the next few years are TD-LTE networks like Clearwire. This is because much of the left-to-be-exploited spectrum globally tends to be higher unpaired frequencies, which TDD is designed for.
Clearwire in turn gets to save Sprint, after Sprint saved it
Sprint is deploying its own FD-LTE network nationwide on 1900MHz PCS spectrum and later adding 800MHz SMR spectrum. However, Sprint’s new LTE network will not provide enough capacity it will need for its customers when they start to migrate to LTE en masse in dense subscriber environments.
Sprint needs Clearwire for additional LTE capacity. Some estimate that Sprint could feel the pinch on their new LTE networks in as soon as 12 months after initial deployment in dense urban areas. This makes use of Clearwire for additional LTE capacity crucial for Sprint in the long term in places where Sprint’s two native 5x5 FD-LTE carriers on 800MHz and 1900MHz start to suffer from reduced performance due to congestion.
Retail model out, Wholesale to the future
Clearwire started to transition away from a full retail model in 2011, as they started shuttering its stores nationwide. Clearwire continues to pare down its retail business strategy, choosing to only pursue an online presence for this category. They also recently started pulling back from its old generation Pre-WiMax Expedience network. Now only leaving a static WiMax network they have left to Ericsson to maintain until 2015 and the build out of their new TD-LTE network for their future.
Clearwire’s future revenue generation is largely squared with a revised wholesale business model. Currently, that is almost solely dependent on Sprint. However, Clearwire wants to diversify its wholesale business model and take on several new customers. And it will take having its new LTE network up and running to do that on a large scale. The wholesale LTE business climate has definitely improved with the sudden demise of LightSquared. Many speculated whether the market could support two LTE wholesale companies.
Looking for a LTE partner to do-si-do?
Clearwire is aggressively seeking new LTE partnerships. They would likely partner with anyone needing a supplemental LTE network. At first thought, it may be easy to conclude that Clearwire would be a good fit as a LTE partner roaming for second tier and regional wireless carriers. These were LightSquared’s bread and butter. But LightSquared was looking to build a nationwide network on 1600MHz. Clearwire does not have those luxuries, it will neither be nationwide anytime soon, nor will its coverage even be comprehensive across any single market.
Clearwire will not be a good fit for roaming deals, expanding 4G coverage nationally for smaller networks. However, Clearwire could be a good fit for those same wireless carriers in markets where they both are already co-located. For instance, let’s take San Francisco for example. MetroPCS has good coverage from its LTE network there. But Metro PCS has pretty low 4G speeds and low capacity. Clearwire is likely to deploy its TD-LTE network in a market like San Francisco early. So when Clearwire gets its SFO coverage well deployed, it will be on hundreds of sites around Frisco.
The Clearwire coverage from these 100’s of sites will look like reverse swiss cheese, though. There will be a whole bunch of cheesy holes of LTE coverage all over. Each one of these Clearwire crop circles of LTE coverage will be blazing fast and support a lot of users with all the spectrum that Clearwire sits on. But in going from crop circle to crop circle, you need LTE in between them on the native network. So Clearwire will not be much help to those wireless carriers or MVNO’s who have no LTE network of their own to cover those notable gaps between Clearwire cells.
Companies like MetroPCS would do very well in a Clearwire TD-LTE wholesale environment, where Clearwire was providing additional capacity in markets that Metro PCS already serves with their own LTE network. Clearwire would not be a good fit for a wireless company that has no LTE network at all. Because the customer would then constantly be going in and out of LTE coverage within a market. This will not create a positive customer environment.
But wait, there is a catch!
Another potential issue with a wireless carrier like MetroPCS partnering up with Clearwire, is how do they handle non-native areas? Should Metro PCS LTE customers only be allowed to use Clearwire TD-LTE in markets where there is a Metro PCS native LTE network? What if that SFO customer traveled to Seattle?
MetroPCS does not have a native LTE network in Seattle. In this case, MetroPCS would have to decide whether to let their customers use the Clearwire TD-LTE in non-native LTE areas and have frustratingly spotty service, or to just block that Clearwire service ever from even being used. This is kind of an uncomfortable choice to make. The issues with smaller wireless companies using Clearwire for an out of market LTE roaming experience are starting to be highlighted and magnified with this instance.
Yeah, there is a work around for that…Sprint
One solution to the problems above is to set up a wholesale or roaming deal with Sprint and Clearwire together, or even a MVNO with both companies. Or better yet, Sprint earned the ability to wholesale Clearwire’s TD-LTE network in the past round of negotiations with Clearwire. So smaller carriers could just go straight to Sprint to negotiate a LTE wholesale, roaming or MVNO solution, and skip trying to set up two separate deals with each.
These are possible comprehensive solutions for wireless carriers that are in pursuit of LTE wholesale options. The biggest challenge to this really becomes devices that will run not only on several Sprint and Clearwire LTE frequencies, but their own native networks too. And for some small wireless companies, this may even be an insurmountable obstacle for them.
The best suited wholesale customers for Clearwire is the Big Dogs
Clearwire is pretty well suited for additional capacity to 4G wireless carriers that already share markets with Clearwire nationwide. These are more likely to be Sprint’s direct competitors. AT&T, Verizon and T-Mobile.
Although this wouldn’t make Sprint very happy, Clearwire would be just fine and dandy supplementing Sprint’s competitiors with more 4G LTE capacity…if they can make money at it. They are not in the position to be to choicey at this time. (the typo is intentional)
The engagement is back on, but a wedding date has not been scheduled
The future for Clearwire is starting to look a little clearer and a little more optimistic. There are many forks in the road ahead, and there will be many dips and twists in the direction it heads toward. In the foreseeable future, Sprint and Clearwire will be well entwined. Sprint needs Clearwire’s spectrum for capacity to supplement their infant LTE network, and Clearwire needs Sprint to keep playing the sugar daddy.
And probably just as Clearwire starts to get legs and starts earning enough revenue to support itself, Sprint will likely sweep in and buy out the rest of the company. To keep it from changing course and possibly damaging Sprint’s future…once again.