Sidecut Reports

Talk about success coming around to bite you in the behind: Apparently Sprint has done such a good job selling its first WiMAX phone, the HTC EVO 4G, that the company doesn’t have any more to sell you — and because of component shortages, HTC hasn’t been able to manufacture enough to keep up with the demand, leaving Sprint empty-handed as it tries to exploit its 4G services lead.

The story that appeared Sunday by the Wall Street Journal breaking the news did contain one fact error, mainly an error of omission. While correctly noting that Sprint does not break out its 4G subscriber numbers, the Journal said “Clearwire Corp., which is building the new network and in which Sprint owns a 56% stake, had 157,000 customers on the network from companies including Sprint at the end of the first quarter.” However, that’s not all the subscribers Clearwire has on its network, but the Journal didn’t include that number — so we will.

What the Journal probably meant to say is that Clearwire has 157,000 wholesale customers on its network as of the end of Q1, a total that includes subscribers added mainly by Sprint and Comcast. Overall, Clearwire had approximately 721,000 subscribers on its 4G network at the end of Q1, a total that includes the 157,000 wholesale customers with the rest being Clearwire’s direct customers.

Read the rest of this entry »

Readers of Sidecut Reports heard about it a couple weeks ago, but today the three companies made it official with a press release spelling out the details of the Clearwire/Intel/Best Buy WiMAX promotion. While we’re not sure who’s footing the big part of the bill, for potential customers the deal is basically a $100 discount for a Best Buy-purchased laptop with WiMAX embedded inside, providing you also sign up for a 2-year contract for Clearwire service.

If you’re in the market for a new computer anyway and want to give WiMAX a whirl, it’s a bit of a deal sweetener and the kind of thing that Clearwire had been shying away from during its initial market launches, since it didn’t really have the cash on hand to subsidize the discounts itself. But with more big-city market launches either already in the books or due to go live this year, more businesspeople may be interested in a laptop that can connect to both Wi-Fi and a 4G network like Clearwire’s, at no additional cost. So the timing seems to be right.

Read the rest of this entry »

While it got lost in the noise generated by the HTC EVO 4G introduction, way back at CTIA Clearwire CEO Bill Morrow hinted about a forthcoming big promotional deal between nascent national WiMAX provider Clearwire, its big partner Intel, and retailer Best Buy. While details of the promotion haven’t yet been released, the plan is already apparently in motion as witnessed by the appearance of Intel/Clearwire backed promotions for discounted WiMAX-enabled gear for purchase at Best Buy outlets.

(Best Buy ads touting discounted prices for WiMAX-enabled netbooks and laptops)

It looks like the search engine optimization is working — the Best Buy ads in the photo above appear clustered around a story about Sprint’s HTC EVO 4G WiMAX smartphone, which went on sale June 4 and recorded boffo numbers according to numerous accounts. But the discounts tell another tale altogether, one that is finally seeing some subsidization coming to the Clearwire WiMAX marketplace. While Clearwire has already been offering pricing discounts on netbooks through its own retail channels, the Intel/Best Buy collaboration is a bit of a sea change for a company that once prided itself on having a no-discount, no-subsidy approach to devices that would use its network.

(Best Buy ordering page for discounted WiMAX gear)

Of course, the HTC EVO 4G is probably the clubhouse leader in subsidized WiMAX gear, since it apparently has sold strongly in all markets where it was available, even with the specter of Apple’s iPhone 4 looming large with its formal introduction today. While we probably won’t learn the hard numbers on EVO 4G sales until Q2 figures are reported sometime in August, the timing of the big WiMAX promotion and some more recent market launches, like Cleveland, Kansas City and Washington D.C. should go a long way toward helping Clearwire reach its year-end goal of more than 2 million subscribers.

Our thoroughly un-scientific research has showed the WiMAX tax dropping in other retail locations as well — at the Lenovo online store the option to add WiMAX connectivity to your laptop has dropped from a $55 option to a $35 option over the last month. We still think that surcharge is a bit steep, but every decline is another buck closer to winning a potential customer. And with Clearwire aggressively taking on AT&T with a public company statement about unlimited network plans vs. Ma Bell’s new pay-per-bit schemes, it’s obvious that WiMAX backers are pushing a lot of chips toward the center of the table this summer in a bid to get ahead in the 4G race.

Editor’s note: The following is an excerpt from our most recent Sidecut Report, The Mobile Data Explosion, an in-depth look at the reasons behind the recent surge in wireless data usage, and where devices, networks and service plan charges are headed in the near future. The following excerpt takes a look at the reasons behind the recent surge of data usage, and why it caught even the biggest service providers by surprise. (To download your free copy of the report, click here.)

WHY IT HAPPENED NOW

How did such a shift in data usage catch an experienced provider like AT&T so unaware? Part of the blame might be the fact that there was a sort of perfect storm hitting the mobile data arena the past few years, radical shifts that might have been manageable had they happened alone — but hard to predict or plan for when they happened all at once. The introduction of “superphones” like the iPhone, combined with faster wireless broadband speeds and new addictive applications like Facebook and Twitter gave people the ability and reason to increase data use rapidly — far beyond than what had ever been seen before.

“AT&T is managing [wireless data] volumes no one else has experienced,” CTO John Donovan told the Wall Street Journal in an interview regarding the stress caused by the iPhone.

Why did the iPhone change the wireless data game so radically? When it was first made available to the public in June of 2007, the most paradigm-shifting thing about the iPhone was its touchscreen interface, an innovation that eliminated keyboard buttons in favor of a screen that was immediately much larger and sharper than that of any previous handheld device.

While the touchscreen was in and of itself a cool toy — making its users easily identifiable as iPhone owners with their telltale finger swipes — the combination of a larger screen size and an advanced browser was the real game-changer, providing for the first time an interface that could mimic a full-page website with enough clarity to make iPhone-version applications immediately understandable.

Read the rest of this entry »

A little busy here at Sidecut central as we put the finishing touches on a new report — but several news nuggets from the past few days bear a bit more questioning, at least from where we sit:

AT&T’s Network ‘Upgrade’ — While it’s good news that AT&T now plans to upgrade the speed of its 3G network, the question that seems to go unasked anywhere we look is what devices will be able to experience the speeds of HSPA+? While the network may be getting faster in spots, most all customers with current equipment will have to purchase new gear to experience the new speeds. So it’s ostensibly an upgrade — but one you will have to pay extra to enjoy.

Read the rest of this entry »