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Clearwire commits to LTE as Verizon weighs Wi-Fi expansion

May 24, 2011 — by LinuxDevices Staff — from the LinuxDevices Archive — 3 views

Clearwire COO Erik Prusch revealed that the ailing company behind Sprint's 4G service will eventually switch its 4G offering from WiMAX to LTE technology, according to an industry report. Meanwhile, Verizon execs said that the carrier might leverage its LTE investment to offer data pooling on family plans, and will also invest more in Wi-Fi, according to two other reports.

Clearwire will eventually transition from a WiMAX-based 4G network to an LTE (Long-Term Evolution) 4G network, Clearwire COO Erik Prusch revealed in an interview with CNet. The company raised the possibility of a transition to LTE back in May 2010, but has now committed to the change.

Using Clearwire technology, Sprint — which owns a roughly 50 percent share of the company — launched its 4G network in 2008, years ahead of its competitors. While Verizon, T-Mobile and AT&T are just now catching up, the types of 4G technology they've chosen — LTE and the LTE precursor HSPA+ — are expected to ultimately be the leading 4G technologies worldwide. 

Sprint has had success with WiMAX-based phones such as its Android-powered HTC Evo 4G and HTC Evo Shift 4G (pictured). However, as Verizon's LTE has come online, it has become clear that WiMAX can't t keep pace. As Clint Boulton writes in a recent, positive review of Sprint's Samsung Nexus S 4G, "The Nexus S 4G is certainly faster than the original Nexus S Google launched last December on T-Mobile's network. However, I used the new Nexus after testing both the HTC ThunderBolt 4G and Samsung Droid Charge on Verizon Wireless' 4G LTE network. If you're guessing Verizon won that race, you'd be right."

According to the May 19 CNet report, Prusch said, "WiMAX to date has been a very good technology choice for us." He added, "We were able to take advantage of the speed to market before LTE was even a glimmer in anyone's eye. But we recognize the ecosystem in the U.S. will be larger for LTE than WiMAX, so we are conscious of that."

Clearwire has had funding issues for some time now. For the first quarter of this year, it reported revenue of $242 million and added 1.8 million subscribers, but nonetheless reported a loss of $226.96 million. With $1.2 billion of cash on hand, the company is feeling forced to pace its retail efforts, despite retail customers being responsible for the majority of its revenue ($181.1 million of that first-quarter $242 million).

Still, Clearwire will wait to make the transition to LTE, Prusch said, until the ecosystem and its technology are mature. "We are technology agnostic," he was quoted as saying. "We don't believe that customers buy a technology. They buy fast and reliable access to a data network."

Clearwire and Sprint rely heavily on one another, to a degree some analysts find problematic. While Sprint has struggled a bit to compete against the iPhone-wielding AT&T and Verizon, it has had to financially assist Clearwire as a means of looking out for its 4G network.

Like Prusch, Sprint CEO Dan Hesse has hinted that LTE is in Sprint's future. Hesse told the Financial Times in July 2010 that Sprint was considering rolling out LTE alongside its WiMAX technology.

"We have spectrum resources where we could add LTE if we choose to do that, on top of the WiMAX network," Hesse told FT. "The beauty of having a lot of spectrum is we have a lot of flexibility."

In the same report, FT added that T-Mobile parent company Deutsche Telekom had considered purchasing Sprint and merging it with T-Mobile, but ultimately decided against it, given that Sprint was invested in WiMAX, while T-Mobile's 4G roadmap had it moving from HSPA+ to LTE.

AT&T, whose 4G path likewise includes transitioning from HSPA+ to LTE, has since made a $39 billion bid for T-Mobile, which has enough spectrum to enable AT&T to eventually extend 4G service to more than 97 percent of the country. Yet, this is still not enough capital, T-Mobile CEO Phillip Humm has said, to enable it to follow through on its LTE plans.

Clearwire's Prusch remained positive about the company's outlook, insisting that it currently has more spectrum than anyone, and just needs to get to the point of growing its revenue organically. In December, the company sold $1.3 billion of debt to fund the continued buildout of its WiMAX network.

"Our subscriber numbers are growing rapidly, and the usage stats show us that there is a desire and demand for more capacity," he said. "So we feel we are well-positioned to meet those needs. We have more spectrum assets than anyone else, and we can handle more capacity than any other carrier." 

Verizon tips long-term service plans

Sprint rival Verizon Wireless is quickly rolling out its LTE network to positive reviews. The carrier launched its first LTE phone in March with the Android-driven HTC ThunderBolt (pictured), followed by several others. Now, the company is revealing new plans based on the increased bandwidth made available by the 4G technology.

Speaking at the Reuters Global Technology Summit, Verizon CFO Fran Shammo suggested Verizon might eventually offer data pooling on its Family plans. Just as carriers have sold business customers large pools of voice minutes that a number of employee devices can dip into, members of a family could sip from a shared data source, she explained.

"At some point, you are going to have mega-plans [for data], and people are going to share that mega-plan based on the number of devices within their family," Shammo said at the Summit, according to a May 21 report from PC World.

Meanwhile, Verizon CTO Tony Melone, at the TIA conference in Grapevine, Texas, revealed that the carrier plans to rely more heavily on Wi-Fi, according to a May 19 Gigaom report. Melone was quoted as saying Verizon would increase Wi-Fi services both to consumers at home and in large venues such as stadiums.

In a sideways dig against AT&T, which last year launched a Wi-Fi hot zones program to complement its 3G network, Melone added "We won't use it ubiquitously to cover up flaws and capacity limitations."

At the Texas event, according to Gigaom, Melone was also said to have stated that by 2013, reliance on 4G LTE might be ubiquitous enough that Verizon can begin shipping devices without 3G radios.

On May 23, Verizon announced two new 4G deployment areas — Springfield and Dayton, Ohio, and Harrisburg, Pa. — both of which are scheduled to go live June 16. During the first quarter alone, Verizon added 906,000 wireless subscribers, thanks in large part to the iPhone 4 and the HTC ThunderBolt.

A longer version of the Verizon story may be found at eWEEK.

Michelle Maisto is a writer for eWEEK.

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