Sidecut Reports

It’s no secret that service providers of all stripes are lining up to grab their share of the government stimulus funding pie directed at broadband deployment. Our friends at DigitalBridge Communications got some prime-time buzz the other night, when CBS Evening News stopped by for a video look:

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The money quote from Kelley Dunne, CEO of DigitalBridge, whose new ambitious plans are part of the rural broadband rollout: He says the company has about 150 applications out there, seeking $40 to $50 million in funding. Good news for the WiMax industry if the applications go through, adding more to the pig-pile of government funding for WiMax rollouts.

Some details are leaking out about an apparent Clearwire-DigitalBridge partnership that is seeking to bid on spectrum that is coming up for grabs in South Carolina. Though nothing official has yet been said publicly by either company, a legislative panel in South Carolina last week apparently recommended a proposed deal by Clearwire and DigitalBridge that would see Clearwire provide WiMax services in urban areas, while DigitalBridge provided WiMax services to rural areas.

According to the news report the deal calls for Clearwire and DigitalBridge to sign a 30-year lease on the state’s spectrum, for $7 million up front and $143 million over the course of the deal. We have queries in to both companies, more as we hear more!

Aside from the deal’s particulars is the interesting idea of Clearwire and DigitalBridge possibly joining forces to form a sort of national WiMax coalition. While DigitalBridge is much smaller in size (and funding), its recent investment from and alliance with the National Rural Telecommunications Cooperative presents the potential of a partnering of Clearwire’s big-urban WiMax markets with any number of rural providers who might use DigitalBridge as a white-label OEM WiMax service provider. A rebel alliance, anyone? To fight the Death Star?

UPDATE, 6/1/09: There is now an official press release on the Clearwire site talking about the proposed deal. According to the release:

Under the plan recommended by the South Carolina Educational Broadband Service Commission, Clearwire would lease approximately 75% of the available spectrum assets and serve primarily urban parts of the state, while DigitalBridge Communications (DBC) would lease 25% and serve primarily rural markets. After a review by the Joint Bond Review Committee, the State Budget and Control Board will consider the commission’s proposal for approval in June.

Looks like rural WiMax provider DigitalBridge Communications has found some new friends in the rural telco business, judging by a couple of announcements today from both Digital Bridge and the National Rural Telecommunications Cooperative (NRTC), which represents some 1,400 rural electric and telephone utilities across 48 states.

The twin announcements — an unspecified amount of funding by NRTC into DigitalBridge, and an agreement under which DigitalBridge will participate in WiMax rollouts by NRTC members — seem squarely focused on helping rural operations get so-called “shovel-ready” projects in line to grab some of the $7.2 billion in rural broadband stimulus funds that the government will spend by September 2010.

As we dig for more information, two things jump out of these agreements: One, that DigitalBridge could secure any further funding at all in the current economy speaks volumes of the investors’ confidence that WiMax is a technology worth betting on. And two, by joining forces with the NRTC, DigitalBridge becomes a trusted supplier to all those rural telcos who might be applying for the stimulus funds — gaining the kind of access and marketing reach that a small operation like DBC might not have been able to quickly secure on its own.

Though small, DigitalBridge is well known in WiMax circles for its WiMax installations, including mobile WiMax services in Jackson Hole, Wyo., that were arguably “the first to market” in the U.S., beating the Baltimore and Portland launches from Sprint/Clearwire. With this deal, it appears that DigitalBridge is getting more ambitious with its WiMax rollout plans; we look forward to hearing more from CEO Kelley Dunne soon.