Clearwire – Launches – What It Means for 4G, LTE, and Cable TV

In 2009, Clearwire is launching its WiMAX service in Texas cities; Abilene, Amarillo, Corpus Christi, Lubbock, Midland/Odessa, Killeen/Temple, Waco, and Wichita Falls. Clearwire is also launching in Boise, Idaho, and Bellingham, Washington. Add Chicago, Charlotte, NC, Dallas/Ft. Worth, Honolulu, Philadelphia, and Seattle for 2009. By the end of 2010 Clearwire plans on launching in New York, Boston, Washington, D.C., Houston, and the San Francisco Bay Area. A lot of markets and important markets they are.

 

What does this mean? It means that Clearwire is now on the clock to provide service and will be under a magnifying glass. Marketing professionals and technologists will be watching the deployments and the operations closely. LTE (long term evolution) supporters will be looking to see if Clearwire makes some misstep, the network collapses, or customers start screaming the service is performing poorly.

 

What does this mean for 4G and LTE? I would say that from a public relations perspective this is a disaster for LTE and a boon for 4G. It is a boon for 4G because WiMAX is a 4G technology. It is a PR disaster for LTE because right now it looks like we won’t even see a beta system for LTE this year. I expect major posturing from the LTE contingent. Maybe the consumer will luck out and we will see a beta system up and running this year. On the one hand, I cannot wait to see head to head competition between LTE and WiMAX but such a fight may not be in the financial best interests of carriers like Verizon and AT&T. Why spend money when you don’t have to?

 

According to LTE supporters, LTE will outperform WiMAX. The challenge LTE supporters is facing is simple economics. Carriers like AT&T Mobility and Verizon Wireless will need to maintain their 3G networks simply because they are meeting the needs of their customers and if you believe AT&T Mobility, 3G enhancements are surpassing consumer needs.   I have said since late 2007 when the recession began that carriers need to be fiscally responsible to their shareholders. If a carrier does not need to deploy a wireless technology then it should not spend the money. This does not mean you stop development or positioning but it does mean you do not spend billions on deploying networks you do not need right now. During this recession the carriers need to be fiscally responsible companies and not reckless about spending cash for a headline.

 

If Wall Street analysts can restrain themselves long enough and not penalize carriers and vendors for not deploying LTE now, they will see that Sprint Nextel and Clearwire have to install WiMAX rather than Verizon and AT&T having to install LTE now. Sprint and Clearwire need WiMAX to reposition their companies.

 

The more interesting story is WiMAX and not because of its rivalry with LTE. WiMAX is interesting because it can propel Comcast, Time Warner Cable, Bright House Networks, and other cable companies into the wireless space. This means new direct competitors for the wireless divisions of Verizon and AT&T. Now that is a more interesting story.

 

Comcast has announced its plans to use the Clearwire and Sprint networks. Basically, Comcast is now an MVNO (mobile virtual network operator). Assuming Comcast has its billing systems up and operating well, this could mean a win for WiMAX as a commercial service. I am waiting to see what Time Warne and Bright House will do.

 

Like I said, the success of Comcast and the other cable partners could also mean expanded competition for Verizon Wireless, AT&T Mobility, and all of the other cellular carriers. WiMAX will enable new competition from the cable companies and that may be WiMAX’s real power.

 

If I were Verizon or AT&T I would be upset and worried that on top of having to deal with Sprint and Cleariwire they will need to deal with the cable companies on both a landline and wireless basis now. Now that is a fight.