Summary
ClearWire's radio access technology is based on WiMAX and not in line with the technology that mobile operators are looking to deploy.
Best partnership model for T-Mobile would be to use the spectrum, but deploy LTE radio of their own which makes the relationship very costly.
The Sprint's ownership in ClearWire cannot be overlooked to see whether they would allow their competitors to gain access.
Analysis
ClearWire is one of a few large carriers in the world that has selected WiMAX for mobile broadband service. Majority of the mobile carriers, including T-Mobile, have decided to use LTE, a competing technology, with wide acceptance around the world, including Verizon and AT&T in the US. It seems that if T-Mobile decies to partner with ClearWire, it would be to use the spectrum that ClearWire has since T-Mobile's spectrum is limited and more is needed to reach higher density markets. It would be highly unlikely that WiMAX will be accepted by a GSM carrier like T-Mobile.
Unless ClearWire changes its radio access to LTE (which it seems that they have not closed the door completely on that) and have a significant footprint, the appetite for merger and acquisition will be limited and the attractiveness of ClearWire will be low.
Also, one cannot ignore that ownership of Sprint in ClearWire where can potentially provide significant road blocks for any type of deal.
The more likely scenario is probably partnership with metroPCS where this carrier is fully committed to LTE and can lease radio access to T-Mobile once their network built out is complete. However, metroPCS's acquisition by T-Mobile would also be problematic today, given that metroPCS is running a 100% CDMA network and can become a boat anchor like Nextel when it was merged with Sprint.
We shall see!
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
