Sidecut Reports

We haven’t seen the rumored WiMAX smartphone that will reportedly be announced by Sprint next week at CTIA, but someone who has told us recently that it’s a beauty, with a big screen tailored for on-the-go video. “It’s the new trophy phone,” our informant gushed. “Pretty darn amazing.”

It’s also probably not going to be available until sometime later this summer, so don’t go flushing those iPhones and Droids down the loo just yet. If you are looking for new wireless devices that might actually be closer to shipment at CTIA, you can join us in a hunt for end-user devices that do a better job of pulling in a WiMAX signal than your standard, naked USB dongle.

We’ve already shown you pictures of Cradlepoint’s version of a portable WiMAX/Wi-Fi router that fits into a home dock with big rabbit-ear antennas to boost signal strength; expect to hear more about that home modem as well as some others from new suppliers that try to improve a problem all wireless networks face: Getting through walls. We’ll be on the lookout for one Clearwire-ready device we’ve heard is in development that is designed for businesses, with strong outdoor antennas to grab the WiMAX signal and a built-in Wi-Fi router to run the LAN inside. Any guesses to the supplier? We should know more next week.

In our recent network report on Clearwire, the company’s chief technical officer Dr. John Saw told us that Clearwire was seeing most of its network use coming from folks who were sitting inside a building, rather than on the go. And in an interview for the same report, Motorola’s WiMAX/LTE guru Bruce Brda predicted that 2010 would see multiple new entrants in the Clearwire CPE game, as the company’s open network started to attract more players than the initial contracted suppliers. Another good guess is more home modems that include integrated support for VoIP, as Clearwire and its partners look to increase the value proposition by adding services.

With a big Sprint event scheduled for Tuesday afternoon, and a joint Sprint/Clearwire keynote on the schedule for Wednesday morning, it could be a big week for WiMAX in Las Vegas, so much different than the scene just two short years ago. Stay tuned here for more news and analysis before, at and after the show.

Our good pal Mari Silbey pointed us to a Motorola announcement today of an interesting new twist on the mobile USB WiMAX dongle — a home docking station that adds antenna power and the ability to suction-cup the sucker to a window, all to improve indoor coverage.

The reason we think this is interesting is because it is our reasoned guess that many users of WiMAX services (like Clearwire’s) will want to go for the cheapest and most mobile plan available, so they sign up for a mobile-only contract, figuring the USB dongle will do well enough inside their house or office. In our recent interview with Clearwire CTO John Saw, this is exactly what Clearwire is seeing — lots of “mobile” use actually taking place inside buildings.

The Moto solution (see video below) addresses the in-building problems by adding antenna power and giving users the flexibility to stick the docking station where it gets the best signal — while then taking the USB dongle with them when they are mobile, for a true home and away solution. The folks from Cradlepoint are following a similar path with their soon-to-arrive portable WiMAX/Wi-Fi router, adding even more flexibility to WiMAX use. In all, seems like that promised stream of WiMAX devices is finally starting to arrive.

(Editor’s note: The following is an excerpt from our latest report, Inside Clearwire: A Network Report, which looks specifically at Clearwire’s use of open core networking standards for its nascent national WiMAX broadband network. The full report can be downloaded FREE by clicking on this link.)

OPEN IN THE CORE MEANS COMPETITION AND SAVINGS

If you follow the cables down from the antennas on a typical “3G” cellular tower, they almost always end up leading into a building the size of a largish tool shed or a small garage — typically a 10-foot by 12-foot (or larger) enclosure that houses all the complex gear necessary to process, separate, administer and manage the phone companies’ mix of voice calls and data traffic.

Since Clearwire is building a data-only network, its tower-site infrastructure needs are much simpler than cellular. To house a typical Clearwire tower site’s power needs, microwave backhaul, WiMAX antenna gear and an Ethernet switch takes merely an enclosure the size of a large refrigerator, sitting on a 3-foot-by-5-foot space.

With far less gear than a comparable cellular site, Clearwire chief techincal officer John Saw said his network is not only obviously cheaper to operate but also more flexible, allowing for quicker and closer deployment toward its customer base.

According to both Saw and Barry West, Clearwire’s president of International operations (and the former head of WiMAX operations at Sprint Nextel before its merger with Clearwire), a typical WiMAX network is about eight to 10 times cheaper to build than a 3G cellular network covering the same area.

“Our average cost number per cell site, when you add in all the backhaul access, zoning costs and everything else, is less than $150,000 per site — and the real number is actually much lower than that,” Saw said. “You’ll never get a cell site at that cost for 3G. What we have done on the network side is the lowest cost approach we could get to.”

Inside its network, Clearwire also embraces an openness that will allow it to reduce costs by introducing a competitiveness not typically found in cellular networks. In the latest implementation of the WiMAX standard, there is a model that calls for true open interfaces between infrastructure gear, like base stations, radios, and administrative equipment like the Access Service Network (ASN) gateway, the workhorse box of a WiMAX network that aggregates and distributes a wide range of subscriber-related data, from session management information, billing data, traffic and mobility management, quality of service and other administrative functions.

In cellular 2G or 3G data implementations, Clearwire’s Saw said that a single vendor almost always provided all the different pieces of gear needed, often at a premium cost. “What we wanted to do with Clearwire was break the monopoly between the base station provider and the gateway provider,” Saw said.

To win a contract for Clearwire’s new IP-based network, however, means that vendors must comply with the open interfaces requirements. Bruce Brda, senior vice president and general manager of the wireless networks business at Motorola, said that opening up such internal interfaces inside a cellular network allows Clearwire to act as its own system integrator, which could produce cost savings and spur product innovation.

“These interfaces have never been open before — now the carriers like Clearwire have the ability to mix and match,” Motorola’s Brda said. “It’s great to have a clean slate, and to have the flexibility to pick the best vendors for the best elements. The downside is control, in how you manage and debug a disparate network. That’s a challenge.”

But Kittur Nagesh, director of service provider marketing at Cisco, said the positives outweigh the negatives when it comes to combining gear from different vendors.

“In some sense you can say Clearwire is now able to pick the best of breed to meet their specific needs,” Nagesh said. “Right now they have transport and Layer 4 to 7 gear from Cisco, and ASN gateways from WiChorus. When it’s done right you can actually combine the best of breed from multiple companies.”

For more on Clearwire’s network, download our latest report, Inside Clearwire: A Network Report, for free by clicking here.

Roughly one year after closing the big deal that produced the “new” Clearwire, the company is moving fast forward on a number of fronts, including opening some long-awaited retail sales sites in a list of cities that includes Chicago and Seattle, plus multiple cities in North Carolina, Texas and Hawaii. The company had already been selling its nascent WiMAX services there via online channels, but the branded retail stores will help with visibility as Clearwire chases its ambitious sales goal of 81,000 new subscribers signed during the last 90 days of 2009.

The reliable Tricia Duryee of mocoNews has a good recap of the history of Clearwire in her home town of Seattle, and pins down Clearwire CEO Bill Morrow on the delivery date for the much-anticipated WiMAX smartphone — which Morrow says will be out by Christmas of 2010, and probably not any sooner. From the sounds and looks of it, one miss this year for Clearwire will be former CEO Ben Wolff’s prediction of “100 WiMAX devices” shipping by the end of 2009. Our friend Mari Silbey also chips in with some memories of WiMAX’s long, slow boat ride in the Windy City, hometown of WiMAX gear supplier Motorola.

Duryee’s report also touches on Clearwire’s expanding business of wholesale and reseller-channel sales — something we are guessing we’ll hear more of in 2010. One of Clearwire’s biggest reseller partners, cable giant Comcast, is also now offering WiMAX in Chicago — that should help Clearwire in its quarterly sales goal! And Clearwire majority owner Sprint is also expanding its 4G territory rapidly, with announcements of service availability today in Seattle, as well as Honolulu and Maui. A complete list of Sprint 4G coverage cities can be found here.

Also emerging last week was a report from Bloomberg about an investment partnership between Intel, Clearwire and MVS Comunicaciones SA to offer WiMAX services to 23 Mexican cities, beginning in 2010. While some folks reading the report might have confused a Clearwire stake with Clearwire’s own recent fund-raising activities, Clearwire in fact does NOT have a cash stake in MVS — though it is unconfirmed, our guess is that Clearwire is chipping in expertise and on-the-ground deployment experience for its minority share in the developing provider. Here is an official Clearwire statement on the MVS investment:

While Clearwire has a minority stake in MVS, we do not have any financial commitments going forward. The recent announcement from MVS regarding expansion plans in Mexico is independent from Clearwire’s plans to cover up to 120 million people in the U.S. by the end of 2010.

Still, that’s a whole lot of WiMAX goin’ on! Still no official word on Verizon’s LTE trials, though. Is there a map for that?

Our second quarterly report on all things Clearwire, the Clearwire NTK October 2009, is now live on the site and ready for download for the low, low price of just $4.95 — that’s correct, four dollars and ninety-five cents. What do you get for five bucks? Here’s a small sampling:

In the October 2009 Clearwire NTK report you will learn:

– Why the Atlanta and Las Vegas market launches, and follow-on launches in smaller cities, have helped Clearwire move from a will-they-ever-arrive to a serious competitor in U.S. broadband markets;

– Why Comcast’s decision to start reselling Clearwire services may have helped Clearwire’s stock price more than double from March to August;

– Why Clearwire is offering discounts and service-price promotions, due to competition from cellular-based offerings like Apple’s iPhone 3 GS;

– Why the cool, small and portable Samsung Mondi mobile Internet device is overpriced and unsuited for Clearwire’s current target market;

– Why Clearwire’s vast spectrum holdings may (finally) help put an end to the aimless speculation about whether or not the company will be able to attract enough capital to finance its aggressive buildout;

– Plus, fun photos from the Las Vegas launch!

There’s more of course, and we’ll have some report excerpts this week as well as excerpts from the behind-the-scenes interviews and research we did on all things Clearwire since our last report back in June. The new report is available for immediate download from www.sidecutreports.com for $4.95. Order your copy today!