Sidecut Reports

Way back when — oh say earlier this spring — there was no shortage of folks willing to toll the final bell on Clearwire’s market chances. Most of these predictive ramblings had little to do with actual market launches or marketing of the company’s WiMAX services, but instead focused on the cash Clearwire had on hand at its creation-merger closing — $3.2 billion — and speculated whether that would be enough to get Clearwire across the finish line. Now it seems like Clearwire might have a fairly bankable asset — its spectrum, which it is now rumored to be of great interest to T-Mobile on a rental basis. Such a fee might produce a nice chunk of change that could go a long way toward meeting Clearwire’s own capital needs.

Here at Sidecut Reports we always thought the woe-is-Clearwire views were short-sighted, and thought such opinions ignored the company’s biggest asset, its huge chunk of wireless spectrum in the 2.5 GHz range. This spectrum has an interesting history — some was initially owned by Worldcom, which was then obtained by Nextel and then by Sprint through various mergers and deals — but it is now all under Clearwire’s purview, with total DEPTH of anywhere between 100 MHz and 150 MHz in most major U.S. markets.

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We’ve been asking for quite some time now the question others seem to be getting around to: Does AT&T really have the network it needs to handle all its iPhone customers? A story out today on BusinessWeek asks the same question, albeit not with any deep insight into the way cell networks operate.

If you read the following excerpt from the story you can see both the report’s somewhat shallow understanding of cellular operations and AT&T’s non-answer answer on how to fix the problem:

One of the biggest choke points in AT&T’s network is found in what’s called back-haul capacity, or the size of the pipe that connects cell towers to the Internet, according to a person familiar with the matter. AT&T is trying to remedy this shortcoming by increasing its back-haul capacity. Donovan tells BusinessWeek that the company has nearly doubled the number of these connections it plans to add this year. While it had planned on adding 55,000, it now plans to add 100,000 to accommodate skyrocketing mobile traffic.

Not sure how much good all that backhaul will do if AT&T is still shorthanded when it comes to spectrum depth — the wireless “pipe” that reaches from the cell tower to the handset. We have asked the company to clarify its spectrum amounts before, but you can bet we will be waiting a long time for an answer because it’s not one that AT&T wants to publicize.

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Google is upping the ante in the ongoing White Spaces issue, announcing today a public advocacy campaign designed to put pressure on the FCC and Washington lawmakers to free up the so-called “white spaces” of wireless spectrum that exists between broadcast TV channels. While the jury is still out on whether this idea can work technically to everyone’s satisfaction, there’s little doubt that finding more spectrum for broadband communications here in the U.S. is a good idea.

While some folks like Om Malik are pointing a cynical eye at Google’s real intentions, I can’t see how opening the debate on this and other matters broadband is anything but good. If we simply listened to incumbent possessors of spectrum on why it’s too risky to try anything new, we might never have had the Wi-Fi revolution happen the way it did. And sure, Google’s Free the Airwaves idea might produce a lot more silly home-cooked video, but if it ultimately opens up another broadband pipe in this country of duopoly providers, it’s worth the effort.

And if you’re a veteran of D.C. telecom lobbying battles, you know that Google’s new group is light-years different from the telecom “front” organizations that hide their real intentions and backers; on the Google public policy blog product manager Minnie Ingersoll is pretty straightforward when it comes to Google’s motivations:

Google has a clear business interest in expanding access to the web. There’s no doubt that if these airwaves are opened up to unlicensed use, more people will be using the Internet. That’s certainly good for Google (not to mention many of our industry peers) but we also think that it’s good for consumers.

Before any of the next-generation ideas in the white spaces can take place, however, the spectrum needs to be freed up. As we noted in our recent QuickCut Report on WiMax Spectrum, there isn’t a lot of spectrum available right now at the 700 MHz frequency, which is where AT&T and Verizon are planning to launch their so-called 4G networks. So why not free up the white spaces, or at least ask more questions why not? Sure it may mean more money for Google, but in these times of pending metered broadband that seems like a weak reason to oppose the idea.