Time is of the essence for Sprint/Clearwire WiMAX deal

Both Sprint and Clearwire sit in a holding pattern when it comes to their mobile WiMAX plans as the two try to hammer out a new deal and entertain outside deals. Clearwire is in cash-conservation mode as it scaled back its mobile WiMAX rollout plans earlier this year [1], while Sprint has yet to launch any more markets beyond the three that were soft launched at the end of 2007.  

With WiMAX's success heavily resting on a joint build-out between the two operators or at least a nationwide rollout this year from Sprint, you would think one of the major WiMAX players would run to the rescue at this crucial time for the technology's commercial debut.  

Back in February, the Street.com reported that Sprint was going to spin off its Xohm unit to form a joint venture with Clearwire with the help of a $2-billion investment from Intel Capital [2]. The deal was expected to be announced in a matter of days, but nothing has happened. Motorola, too, has a viable interest in seeing mobile WiMAX roll out on a nationwide basis as it has reinvented itself as a leading WiMAX supplier. We haven't seen it step up either.

I can only imagine what the hold up is. I suspect Sprint understands WiMAX is its future and rejects any plans that would see it give up control of the business. So it appears a spin-off might not be in the cards. Of course, a spin-off is more ideal for any investor as it separates the WiMAX business from the severe core problems Sprint is facing.

At any rate, the longer it takes for WiMAX to roll out, the more the technology's advantage in the 4G market erodes.--Lynnette [3]