The New Clearwire – Should Increase Access for Cable Companies

Implications: Short of buying their own spectrum, Comcast, Time Warner Cable, and Bright House Networks have no choice but to join the Sprint initiative. If the cable companies believe in the triple play, than the new Clearwire is a lifesaver because without it they won’t have the quadruple play. The partnership is necessary.

Analysis: The telecom triple play, as opposed to the baseball triple play, is a marketing concept for the provisioning of telecom broadband services over a single set of wires.  The services were Internet access, video, and plain old telephony.  The quadruple play is providing the triple play over wireless.

Spectrum costs a fortune to bid on.  Bright House Networks, Comcast, and Time Warner Cable are fairly large national systems.  The amount of money needed to buy their own spectrum to cover their respective territories is prohibitive.  They would end up spending billions getting the spectrum and then spend billions building and operating a network they have no experience with.

The new Clearwire, enables them to get into wireless without having to foot the whole bill.  The idea of the new Clearwire is good.  The execution will be an overall issue.

However, there are going to be a number of issues facing the cable companies in this new Clearwire relationship.  The most urgent and immediate issue will be the deployment locations and schedule for WiMAX.  The reality is that the cable partners of Clearwire need to know when WiMAX will be deployed in their respective markets.  With so many partners it will be important to understand where each finds itself on the pecking order of deployment.

Coverage of the system will need to match cable coverage otherwise the cable companies will lose all benefits of the wireless system.  Clearwire will need to take the service footprints of all of the partners and overlay the WiMAX deployment on top of these footprints.  Of course, just as important will be the new Clearwire’s need to coordinate with the partners’ respective strategy organizations.

The new Clearwire cannot operate as if it is an entity unto itself.  The company has owners and it will need to be sensitive to the needs of the owners.

The partnership will be difficult to manage but is necessary.