Flexing those 4G muscles
We may still be a long way from realizing nationwide high-capacity mobile broadband, but cellular operators took some sizable first steps this week. Sprint (NYSE:S) finally resolved its back-office issues with Clearwire (NASDAQ:CLWR), allowing the CDMA carrier to launch 3G/4G service across Clearwire’s entire, albeit limited, mobile broadband footprint. Meanwhile Verizon Wireless (NYSE:VZ) revealed the identity of its first two trial markets, announcing Friday it had completed its first two long-term evolution data calls in Boston and Seattle using Alcatel-Lucent (NYSE:ALU) and Ericsson (NASDAQ:ERIC) equipment.
Clearwire and Sprint obviously have a bit of a head start on Verizon, but not an enormous one. While Verizon has a total of 20 base stations online, Clearwire has more than 1000 spanning four markets. And while VZW’s network is in its trial phases, Clearwire’s small footprint has the advantage of being commercial with real customers and real devices. Clearwire, however, is trying to ensure it not only maintains its lead, but even extends it before Verizon’s LTE network goes commercial in 2010. New CEO Bill Morrow said on Clearwire’s earnings call last week that the operator would be live in at least 25 markets by year’s end.
While big cities such as Chicago, Philadelphia and Seattle are on the list, most of those new markets will be small and mid-sized cities such as Killeen, Texas, and Bellingham, Wash., where Clearwire already runs a fixed and nomadic broadband wireless service. Morrow projected Clearwire’s footprint would cover 30 million by year’s end — no paltry sum but less than a tenth of the country’s population. The big building program begins next year with the goal of reaching 120 million pops covered by the end of 2010. Clearwire has even taken on a new vendor, Huawei, to help out.
Much depends on timing. If Clearwire rolls out most of that network in the beginning of the year, it could find itself sitting pretty along with Sprint in the country’s major markets before Verizon flips its first on-switch. But if those rollouts are packed toward the end of the year, Clearwire could be going head-to-head with VZW in many cities. Verizon certainly isn’t shying away from a fight. The two markets it has picked for trials are two markets where Clearwire has clearly identified plans to launch. Seattle will come online this year, but Boston is being held until 2010. If Verizon’s field trials suddenly become commercial pilots, Clearwire may find itself outmaneuvered in several key cities. Things are bound to get interesting.
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