4G WiMAX Service Explained
Clearwire Corporation is a wireless internet service provider (WISP) serving markets in the United States, Belgium, and Spain. Clearwire, founded by cellular phone pioneer and AT&T Wireless Services founder Craig McCaw in October 2003 is headquartered in Bellevue, Washington. Clearwire primarily uses a wireless technology called WiMAX transmitted from cell sites over licensed spectrum of 2.5–2.6 GHz in the United States and 3.4-3.6 GHz in Spain.
In the United States, Clearwire offers CLEAR 4G service with average download speeds of 3 to 6 Mbit/s with bursts over 10 Mbit/s. Actual CLEAR network performance may vary and is not guaranteed.
Clearwire also offers its own Voice over IP service in some areas for an additional monthly fee. As with any ISP, the listed transfer rates are under ideal conditions; actual results vary greatly depending on factors such as service load, distance, and obstacles between the transmitter and receiver. Another factor is that available bandwidth is shared between users in a given radio sector, so if there are many active users in a single sector, each may receive reduced bandwidth.
In pre-WiMAX markets in the U.S. and Belgium, Clearwire uses the Motorola Licensed Point-to-Multipoint Expedience system, which is part of the MOTOwi4 family of products. They also offered the same service in Ireland (until purchased by Imagine Communications) & Denmark (until purchased by ERLO Group and operating as Skyline) also. The service is considered true Non-Line-of-Sight (NLOS). Customers can choose either the Motorola Expedience Residential Subscriber Unit (RSU) or the Motorola Expedience PC Card in both the PC Card and ExpressCard form factors. The RSU incorporates automatic adaptive modulation for increased throughput and network capacity. Users are connected to the Internet at indoor locations throughout the entire system's coverage area. The unit functions as an Ethernet bridge (Layer 2) device, interfacing a standard Ethernet over twisted pair connector. The PC Card incorporates the same automatic adaptive modulation for increased throughput and network capacity with the added portability of a laptop CardBus card. The service is not unique to Clearwire. Several companies throughout the world use this same product line from Motorola. For instance: Inukshuk Wireless Partnership of Canada, Beamspeed and Commspeed of Arizona, AccessTEL of Bangladesh, and Unitel of Guatemala all use the same type of service and equipment.
4G WiMAX Service
, the company, on January 6, 2009, unveiled Portland, Oregon as its first 4G WiMAX wireless broadband market, enabling consumers and businesses to access the Internet, wirelessly, at broadband speeds.
Since the Portland launch, the company has expanded its 4G network to additional markets including: San Francisco, Sacramento, Merced, Visalia, Los Angeles, Modesto and Stockton, Calif.; Denver, Colo.; Bridgeport, New Haven and Hartford, Conn.; central Washington, D.C.; Wilmington, Del.; Miami, Tampa Bay, Orlando, Daytona Beach and Jacksonville, Fla.; Atlanta and Milledgeville, Ga.; Honolulu and Maui, Hawaii; Boise, Idaho; Chicago, Ill.; Boston, Mass.; Baltimore, Md.; Grand Rapids, Mich.; Minneapolis/St. Paul, Minn.; St. Louis and Kansas City, Mo.; Charlotte, Raleigh, and Greensboro, N.C.; Trenton and New Brunswick, N.J.; New York, Syracuse and Rochester, N.Y.; Las Vegas, Nev.; Cincinnati, Columbus, and Cleveland, Ohio; Salem, Portland and Eugene, Ore.; Pittsburgh, Philadelphia, Harrisburg, Reading, Lancaster and York, Pa.; Providence, R.I.; Nashville, Tenn.; Dallas/Ft. Worth, Houston, San Antonio, Austin, Abilene, Amarillo, Corpus Christi, Killeen/Temple, Lubbock, Midland/Odessa, Waco and Wichita Falls, Texas; Salt Lake City, Utah; Richmond, Va.; Seattle, Tri-Cities, Yakima and Bellingham, Wash.
Sprint, Clearwire's largest investor, resells Clearwire's 4G network service as Sprint 4G in over 71 markets across the United States.
Clearwire investors Comcast and Time Warner Cable resell Clearwire’s 4G mobile broadband service in a number of markets, including New York City, Los Angeles, Chicago, Philadelphia, Atlanta and Portland among others bundled with their cable, home phone, and residential Internet services.
On June 4, 2010 Sprint introduced the first commercially available 4G cellphone in the U.S. the HTC EVO 4G. The device combines Clearwire’s 4G network with Sprint’s 3G network and Google’s Android operating system, creating a multimedia-heavy device Sprint hopes will set it apart from 3G smartphones like the Apple iPhone.
In January 2011, Clearwire started offering 4G WiMAX service in Spain under the brand Instanet instead of the Expedience service that it was previously offering before that.
The forerunner of Clearwire was an Arlington, Texas-based company then known as Clearwire Technologies, Inc. (owned by Clearwire Holdings). Clearwire Technologies was formed by a number of investors including Edward "Rusty" Rose, once a co-managing partner of the Texas Rangers. Clearwire Technologies raised at least $100 million and used it to acquire spectrum allocated to various educational institutions in the former Instructional Television Fixed Service (ITFS) band now known as EBS or Educational Broadband Service.
Clearwire Corp. as it is now known was born when Craig McCaw's holding company, Flux LLC, acquired Clearwire Holdings in March, 2004. McCaw installed executives from his McCaw Cellular as the new Clearwire Corp. leadership.
Clearwire had grown from 1,000 customers in September 2004 to more than 443,000 customers across its markets, as of May 2008. Clearwire claimed in September 2006 that 20% of its markets have more than 10% penetration of households covered.
Clearwire took a $900 million infusion of capital from Intel and Motorola in July 2006, shortly after pulling its IPO. Clearwire's equipment manufacturer Nextnet Wireless was sold to Motorola as part of the exchange. This investment by these two industry giants had been reported as an attempt to accelerate the development and deployment of WiMAX networks worldwide.
An unspecified source claims that AT&T sold Clearwire a slice of 2.5 GHz spectrum for about $300 million. The spectrum covers markets in the southeast of the U.S. and was formerly owned by BellSouth. The spectrum solidifies Clearwire's position as the second largest holder of 2.5 GHz spectrum after Sprint Nextel. AT&T had to sell the spectrum as a condition of its merger with BellSouth.
Clearwire and Sprint Nextel announced a partnership in July 2007 to accelerate deployment of WiMAX technology across the US. The deal was to include a swap of spectrum and markets between the two companies, as well as providing roaming capabilities for customers traveling between the companies' networks. The partnership was terminated at the end of 2007. In 2008, Sprint's new CEO Dan Hesse started serious discussions about forming a joint venture between the two companies in the hopes of bringing in outside funding from Google, Intel, and Best Buy. On March 26, 2008 an anonymous source stated that Sprint and Clearwire may get as much as $1 billion from Comcast and $500 million from Time Warner Cable in financial backing.
Clearwire filed for its initial public offering with the Securities and Exchange Commission in May 2006 and went public Thursday, March 8, 2007. The company's underwriters included Merrill Lynch, Morgan Stanley and JPMorgan Chase. Trading began March 8, 2007 under the ticker symbol "CLWR" on the Nasdaq. Clearwire offered 24 million shares at $25 a share, and raised approximately US$600 million. Before the Sprint merger, Craig McCaw was the largest shareholder of the company with a majority of the shares.
On May 7, 2008, Clearwire and Sprint Nextel's wireless broadband unit Xohm announced their intent to merge, combining Sprint's 4G WiMAX network (Xohm) with Clearwire's existing pre-WiMAX broadband network. Sprint owns 54% of the firm, with ex-Clearwire shareholders owning 27% — a consortium of Comcast, Time Warner Cable, Intel, Google, and Bright House Networks invested $3.2 billion and own the balance. Clearwire and the cable companies will buy 3G mobile broadband from Sprint as MVNOs. Clearwire/Sprint Nextel officially launched Portland, Oregon as the first market using the new service. Today Clearwire's 4G service is branded CLEAR, except in those markets where the Clearwire name has already been established and where CLEAR service is not available. (However, it remains uncertain whether this new incarnation of Clearwire, controlled by Sprint, will still continue to offer the contractual conditions which have sparked class action lawsuits.) Today CLEAR 4G is available in 35 of the top 40 MSAs in the country covering 130 million people.
On March 9, 2009 Clearwire named Bill Morrow as CEO, succeeding Benjamin Wolff, who became Co-Chairman with Craig McCaw. Morrow, 49, stepped down as CEO of Pacific Gas & Electric Company. Morrow had previously held a number of senior positions at Vodafone.
On December 31, 2010, McCaw resigned as Chairman of Clearwire and was replaced by John W. Stanton. On March 10, 2011, Bill Morrow resigned as CEO and was replaced by Interim CEO John W. Stanton. On August 10, 2011, Clearwire promoted COO Erik Prusch to President and CEO; named John Stanton Executive Chairman.
Clearwire had stated that it may not honor a $237 million debt covenant due on December 1, 2011 in order to conserve cash. However, on December 2, 2011, the company announced that not only had it made that payment, but it had made a new four year deal with Sprint to receive funding for network buildout and investments valued at $1.6 billion.
Criticism and Legal Action
In 2005, Clearwire drew criticism from phone operator Vonage, who claimed the network, among others, was blocking their services. Clearwire did not immediately respond to the claim, even though subsequent testing showed that Vonage calls were indeed being connected over the Clearwire network. It could be argued that providers of high-bandwidth wireless services, such as Clearwire, are threatened by VoIP providers who utilize the internet link to compete on the same market.
In April, 2009, a class-action lawsuit was filed against Clearwire. The complaint alleges that the company's advertisements are deceptive in their promises of fast, reliable Internet access, and of Internet-based telephone service that's superior to conventional wired phone service. More specifically, it alleges that consumers of the firm's Internet access service frequently experience speeds that are as slow as those available with a dial-up modem, and that both Internet access and Internet telephone service are often entirely unavailable. The lawsuit also claims that when consumers try to cancel their contracts for these or any other reasons, the company charges a pro-rata early termination fee of up to $220, and that this fee cannot be lawfully imposed or collected. Clearwire declined to comment on these allegations, citing corporate policy. The claim has since been dismissed by the judge and is currently on appeal.
In September 2010, Clearwire introduced a dynamic network management system, which limits users who consume disproportionate amounts of wireless data. Many users have reported that their terms of service were modified retroactively to reflect the new policy, and Clearwire itself has unofficially acknowledged this. In December of the same year, a class-action lawsuit was filed in Washington alleging deceptive advertising concerning the company's policies of bandwidth throttling and not disclosing early-termination charges.