Clearwire expanding footprint with Sprint 3G; taps Ciena for backhaul

Clearwire (NASDAQ:CLWR) plans to augment its still-tiny 4G footprint with Sprint’s nationwide 3G network, vastly expanding the coverage of its Clear mobile broadband service though sacrificing much of its speed. At Clearwire’s official Las Vegas WiMax launch, Clearwire announced the new 4G+ service will be available on Aug 1 as well as revealed another of its growing list of vendors, Ciena (NASDAQ:CIEN), which is supplying the Ethernet transport technology powering its high-capacity backhaul network.

Sprint (NYSE:S) became Clearwire’s largest stakeholder when it merged its Xohm WiMax assets with Clearwire last year with the intention of becoming a favored virtual 4G operator over the Clearwire network. Now the relationship is mutual. Sprint has bundled Clearwire’s WiMax service with its CDMA EV-DO data card offerings, and starting next month Clearwire will become a mobile virtual network operator (MVNO) on Sprint’s network, offering its own 3G/4G data card for $80 a month and  a two-year contract.

While much more expensive than Clearwire’s standard $40-a-month unlimited-data no-contract mobile Internet plans, the 3G/4G service will temporarily solve the problem of Clearwire’s very limited footprint. When a current customer leaves Clearwire’s four currently launched markets—Baltimore, Atlanta, Las Vegas and Portland, Ore—he or she loses all connection to the wide area network. Though Sprint’s EV-DO service is ubiquitous, it isn’t as fast as Clearwire’s 4 Mb/s service, and Sprint will likely impose a data cap to prevent capacity-hungry Clear customers from hogging network resources. Sprint currently puts a 5-GB monthly cap on its high-end 3G broadband plan, but Clearwire hasn’t yet released details on data restrictions so a smaller cap may be imposed.

4G+ may wind up being a temporary service to keep mobile professionals and other jet setters happy while Clearwire builds out its nationwide footprint. The company plans to launch another service in at least six more major metro markets this year, followed by a bigger expansion in 2010 that will cover 120 million people by year end.

With the launch of the combined service, Sprint and Clearwire seem to have resolved the back-office problems preventing interoperability between Sprint-built and Clearwire-built networks. So far Sprint has only been able to offer 4G to its customers in Baltimore, but today Sprint said it would expand the service to the remaining Clearwire markets. Clearwire has also developed connection software that will allow its modems to work with the Apple (NASDAQ:AAPL) Macintosh operating system, extending the services reach to growing legions of Mac laptop users.

Clearwire today also announced Ciena as its primary Ethernet backhaul equipment supplier. Ciena has deployed its Ethernet switches and aggregators in all of Clearwire-built WiMax so far, and due to Sprint also naming Ciena a vendor last year, its equipment is already in the Baltimore network and in the forthcoming Sprint-initiated markets of Boston, Philadelphia, Dallas-Fort Worth, Chicago, and Washington, DC. Sprint is using a combination of point-to-point microwave and fiber links to backhaul the enormous traffic flows from its WiMax cell sites, most of which are designed to handle capacities in excess of 100 Mb/s. While Ciena doesn’t provide the links itself, it supplies the Ethernet framework riding on top.