2nd time's a charm?

Sprint merge with Clearwire? Google and Intel investors?

Once operational, Sprint Nextel and the cable companies will be able to “buy” WiMAX service from Clearwire to resell to their subscribers similar to a mobile virtual network operator model. Clearwire and the cable companies will also be able to buy traditional cellular services from Sprint Nextel to complete their bundled offerings. Sprint Nextel’s West said the carrier would work on integrating the WiMAX network with its current CDMA-based 3G network and was looking at providing dual-mode devices beginning next year.

For its $500 million investment, Google will become the default Web and local search service for Sprint Nextel’s services, while Intel’s $1 billion investment will give it more opportunities to supply chipsets to enable WiMAX-compatible devices.

Google and Intel will also have the option to enter into wholesale agreements with both Clearwire and Sprint Nextel to offer services, but noted in the press release that they currently do not have plans to do so.

Clearwire said it plans to cover between 120 million and 140 million potential customers by the end of 2010, which were terms set forth by the Federal Communication Commission when Sprint Corp. acquired Nextel Communications Inc. Sprint Nextel’s West said the company was on track to cover 15 million pops by the end of this year, while Clearwire was set to cover 6 million pops with mobile WiMAX technology.

“We believe this announcement is a ‘win-win’ for all parties involved,” noted Stifel, Nicolaus & Co. Inc. “[Clearwire] received the funding it needs to resume its aggressive network build, [Sprint Nextel] retains majority ownership without the operational headaches, … [the cable companies] have a relatively inexpensive option to provide wireless services to their customer base, Google gets preferential access to a wireless platform … and Intel gets a base for its WiMAX technology.”

The plan

Once operational, Sprint Nextel and the cable companies will be able to “buy” WiMAX service from Clearwire to resell to their subscribers similar to a mobile virtual network operator model. Clearwire and the cable companies will also be able to buy traditional cellular services from Sprint Nextel to complete their bundled offerings. Sprint Nextel’s West said the carrier would work on integrating the WiMAX network with its current CDMA-based 3G network and was looking at providing dual-mode devices beginning next year.

For its $500 million investment, Google will become the default Web and local search service for Sprint Nextel’s services, while Intel’s $1 billion investment will give it more opportunities to supply chipsets to enable WiMAX-compatible devices.

Google and Intel will also have the option to enter into wholesale agreements with both Clearwire and Sprint Nextel to offer services, but noted in the press release that they currently do not have plans to do so.

Clearwire said it plans to cover between 120 million and 140 million potential customers by the end of 2010, which were terms set forth by the Federal Communication Commission when Sprint Corp. acquired Nextel Communications Inc. Sprint Nextel’s West said the company was on track to cover 15 million pops by the end of this year, while Clearwire was set to cover 6 million pops with mobile WiMAX technology.