Clearwire, in crisis mode, loses CEO

The man Clearwire (NASDAQ:CLWR) brought in to guide the company through its nationwide expansion is stopping well short of his goal. Bill Morrow today resigned as CEO of Clearwire, taking two of his handpicked staff with him. Newly-appointed chairman John Stanton temporarily will take over the chief executive’s role immediately, making him the third CEO Clearwire has had in two years.

“I would like to commend Bill for his tremendous leadership in building the first U.S. 4G network, adding more than 5 million subscribers, and raising funds in a challenging economic environment,” Stanton said in a statement released by Clearwire. “Together, the entire management team at Clearwire remains focused on delivering value to its customers and shareholders.”

Chief Commercial Officer Mike Sievert and Chief Information Officer Kevin Hart are also departing to pursue other opportunities, but will remain at the company during the transition period, Clearwire said. Morrow brought both Sievert and Hart on board in an executive shake up in 2009 (CP: Clearwire reshuffles executives), shortly after he took over as CEO from Ben Wolff (CP: Clearwire taps new CEO for WiMax expansion). Morrow will also resign his seat on the Clearwire board, but will continue to advise the board while a search committee seeks a new CEO.

In the Clearwire statement, Morrow cited personal reasons for leaving, and left it at that. There’s still no word on whether Morrow left of his own accord, abandoning what he viewed as a sinking ship, or whether he was forced out after failing to secure new funding or partnerships that would have assured Clearwire’s survival and the completion of its network.

Whatever the reason, Morrow is leaving a company whose future is uncertain. Clearwire has run out of cash and has effectively shut down any new WiMax rollouts with only one-third of its planned nationwide network complete (CP: Clearwire completes 2010 WiMax build). The company has been forced to streamline its operations to conserve cash, canceling plans to launch its own smartphones and scaling back its own Clear retail brand. Clearwire also is engaged in a public spat with its majority owner Sprint (NYSE:S) over wholesale access rates for Sprint’s smartphones. Sprint CEO Dan Hesse has been alternately firm and supportive with its young charge, claiming last week that Sprint had a “Plan B” if negotiations with Clearwire didn’t pan out (CP: Sprint using LTE as cudgel against Clearwire), and stating this week that any 4G strategy it adopts will most definitely include Clearwire’s WiMax service (CP: Sprint CEO says all 4G paths involve Clearwire, WiMax).

Amid that backdrop, Clearwire is facing increased competitive pressure from the major wireless operators, who have hacked away at the operator’s time-to-market advantage by labeling their mobile broadband services as 4G—a term Clearwire figured it had a monopoly on until long-term evolution (LTE) networks emerged. Verizon Wireless (NYSE:VZ, NYSE:VOD) launched the first of those networks late last year, reaching 110-million pops footprint on its first day—something it took Clearwire more than two years to accomplish. Clearwire is even facing pressure from its customers. A new lawsuit claims Clearwire is restricting bandwidth to is residential customers after the cross a capacity threshold (CP: Clearwire faces lawsuit for throttling “unlimited” network)

Clearwire’s future has become even more clouded because of Sprint’s vagueness about its own future mobile broadband plans. Sprint has hinted strongly that it will move to LTE later this year and is starting to build the new multi-mode network that could support that technology (CP: Sprint lays out a vague path to LTE with $5B network modernization). But Sprint executives have been peppering financial conferences and newspaper stories with all sorts of comments that would seem to contradict that strategy. In addition to Hesse’s claim that any LTE network would run in parallel with Sprint’s WiMax service, Sprint executives have been talking up the possibility of network sharing agreements with Clearwire, which would see the WiMax network hosted on Sprint’s new Network Vision architecture. Sprint has even gone so far to require its vendors Ericsson (NASDAQ:ERIC) and Alcatel-Lucent (NYSE:ALU) to acquire the necessary technology from rival Samsung (CP: Ericsson, ALU licensing Samsung WiMax tech).

Confusing the matter even further, reports are now emerging—though still unverified—that Sprint is dangling the same network hosting carrot in front of LightSquared, which is looking to build a nationwide wholesale LTE network (DSLReports: Source: Sprint LightSquared partners on LTE build). Sprint isn’t commenting on that speculation, but it has acknowledged that set an arrangement would be technically feasible.

Clearwire’s interim CEO Stanton (CP: Clearwire goes back to McCaw Cellular days for new Chairman) has his work cut out for them. Not only will he have to take over negotiations with the publicly schizophrenic Sprint, he’ll inherit Clearwire’s funding crisis, though that may be a problem he’ll want to pass on to the new CEO. He’ll have help from two newly promoted executives: Chief Financial Officer Erik Prusch has been elevate to Chief Operating Officer, a position Clearwire didn’t previously have, while senior vice president and Treasurer Hope Cochran will take over form Prusch as CFO.