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« About Sprint and Clearwire's 4G Coverage | Main | 20 City WiMax Rollout in Poland »

August 8, 2006

Does Sprint Move Open Up Potential of Many Mobile WiMax Providers?

By Glenn Fleishman

As noted in earlier posts, Sprint and Clearwire own the best spectrum for mobile WiMax in the US: Having chosen, each of them, to deploy that technology, it’s quite unlikely that any other firm at present has the right combination of licenses to challenge them in other bands on a national scale. What is possible is that smaller licensed parties that are highly regional could leverage the equipment choices of Sprint and Clearwire that will turn WiMax into a much more highly commodified technology—coupled with Intel’s commitment to package WiMax adapters in future laptops—to deploy small networks.

I don’t know about smaller licenseholders in 2.5 GHz as a class, but there are enough licenses in bits and pieces that it’s possible a rural area might have a provider that opts for mobile WiMax in licensed 2.5 GHz as an alternative to broadband wireless (using current fixed WiMax technology). This is partly because there’s no certification profile yet and may never be a profile for using fixed WiMax in unlicensed spectrum, although there’s some interest in the 5.8 GHz band.

If 2.5 GHz mobile WiMax gear becomes cheap enough, then a small town without competitive Clearwire or Sprint service could find itself with a mobile WiMax provider, but the economics have to be awfully solid. Many of the arguments against Wi-Fi and broadband wireless stem from unlicensed spectrum. But the flaw with licensed spectrum is paying to buy or lease that license. The small town’s FCC licenses for 2.5 GHz might still be too expensive to purchase for a smaller firm even if larger companies aren’t offering service. Or a small firm might roll out service, only to see Clearwire or Sprint activate a network using licenses they hadn’t built out for yet.

Posted by Glennf at August 8, 2006 3:11 PM

Categories: 2.5 GHz, 802.16-2005 (16e), financial

Comments

If I were a rural telco (independent or co-op) wanting to get into the mobile data biz, I'd be tracking down who holds the EBS licenses in my service area and coming up with a lease deal.

The EBS licenses share the 2.5 GHz with the BRS licenses, but weren't auctioned; originally intended for wireless cable, they were given away to educational institutions. The FCC's secondary market initiative relaxed the spectrum lease rules to allow 90% of these licenses to be leased for secondary use; this is one way Clearwire gets to their 90M figure -- they've been agressive on the leasing front.

As Sprint plays Moto off against Samsung to drive the WiMAX BTS costs down, and as increased volumes drive CPE cost down, a rural telco that had a good relationship with the local educational institutions could make a favorable lease deal on EBS licenses, deploy small-scale WiMAX coverage, and offer its customers mobile data services with nationwide roaming onto Sprint and Clearwire networks.

Posted by: DG Lewis at August 9, 2006 6:48 AM

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