Clearwire's WiMAX spectrum position vs. LTE's dominance. Who will win?

Is it the spectrum that will give Clearwire a distinct advantage over major rivals such as AT&T Wireless and Verizon Wireless in the new high-speed broadband data world? That was the message that Clearwire, which is set to merge its WiMAX assets with Sprint Nextel's, hammered home to investors last week. Its message: AT&T and Verizon cannot match the company for spectrum [1].

"We believe the LTE operators will be hard-pressed to find the spectrum to build a nationwide broadband network," Clearwire CTO John Saw said at the investor event, according to an article in Unstrung.

Indeed, once Clearwire merges its business with Sprint Nextel, the operator will have more than 120 megahertz of spectrum per market in the 2.5 GHz band. This will allow Clearwire to offer download speeds of 6 to 15 MB/s per user, said Clearwire CEO Ben Wolff. Those kinds of data speeds and capacity will enable the operator to move beyond pure high-speed data offerings and into services such as wireless HDTV, according to the company.

Plus, according to the Mobile Pricing Report from Tariff Consultancy, unlimited data bundles are becoming the norm for mobile operators worldwide. The trend toward inclusive and unlimited offers is becoming unstoppable and data plan bundling represents the new battleground for mobile operators looking for growth. That means a huge swath of spectrum is an important competitive tool in a marketing environment that is inevitably headed toward all-you-can-eat pricing. The nature of the Internet is changing. Streaming music, streaming video and a lot of other bandwidth-intensive applications are emerging, continually using up more bandwidth.

Meanwhile, AT&T, Verizon Wireless and other major operators around the globe are deploying Long Term Evolution (LTE) technology, which means LTE could blanket just as many U.S. markets (assuming the operators cut roaming deals) as Clearwire's WiMAX beyond 2010, hurting WiMAX's head start. Moreover, LTE should have better economies of scale given the expected aggressive uptake of the technology. A new study from ABI Research says LTE technology will support more than 32 million subscribers by 2013. That's three years after the technology is expected to become commercially available.

So what has the advantage? Clearwire's spectrum position or the promised dominance of LTE?--Lynnette [2]