Who’s Surprised by a Clearwire Spectrum Auction? Not Sidecut Readers

If the generally reliable Bloomberg info-empire is to be believed, nascent national WiMAX provider Clearwire is in the midst of a potential auction of some of its excess wireless spectrum, with interest shown from the obvious potential bidders, a list that includes AT&T, Verizon and Deutsche Telekom, parent of T-Mobile. Is any of this a surprise? Not to longtime readers of Sidecut Reports, which from day one has stressed that Clearwire’s spectrum assets were an undervalued crown jewel, one that the company may now be using to help raise anywhere from $2.5 billion to $5 billion in order to keep funding its ambitious network buildout.

In fact, a little over a year ago we wrote a post that called those assets the crown jewels, and explained then that Clearwire had so much spectrum compared to other providers that it could launch a wide WiMAX network, have enough spectrum left over to launch a wide LTE network, and then still have enough spectrum to sell or rent some spare airwaves to fund its ongoing operations. (If you want a thorough explanation of the spectrum assets, by all means download our free report on the subject, which covers all nuances in great detail.)

Last week, Verizon’s Lowell McAdam was making big hay about his company’s 20 MHz swath of spectrum that it will use for its forthcoming LTE rollout. Clearwire, by comparison, has anywhere from 100 MHz to 150 MHz of spectrum in most of the top U.S. markets. And no matter which technology you use, WiMAX or LTE, spectrum is the life blood of the network you build. With 20 MHz of spectrum depth, Verizon thinks it will have a pretty snappy LTE network. Even with 30 MHz to 60 MHz being used for WiMAX, that still leaves Clearwire with about 90 to 120 MHz spare spectrum in each market it has. How fast will Clearwire’s LTE implementation be if it has three times the spectrum of Verizon’s to work with?

Or more importantly, how much is an instant 10 MHz or 20 MHz of spectrum worth to an AT&T, a company that still hasn’t proven that it can build a network that can support the sales success of its exclusive iPhone deal? Ever since Clearwire rolled out its wholesale network business (where it resells its services to investment partners like Sprint, Comcast and Time-Warner Cable) its top execs have been pretty candid that they would entertain deals from all corners for wholesale network services or spectrum rentals. How it all shakes out vis-a-vis the recent boardroom gymnastics is still a question to be answered; but the worth of Clearwire’s spectrum assets, and the company’s willingness to use those assets to forward its business plan, have never been in question for Sidecut Reports readers.

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