Alltel Snubs Clearwire: Can Sprint Make WiMax Work By Itself?

Dan Frommer | May 16, 2008 4:45 PM

alltel-map.jpgAlltel, the fifth-largest U.S. wireless carrier, says it will use LTE technology for its next-generation wireless network, not rival WiMax technology. This leaves Sprint Nextel (S) as the only major U.S. carrier using WiMax for its 4G network. (Sprint will spin off its WiMax network into Clearwire (CLWR) this year, pending approval.)

Why does this matter? Alltel isn't very big subscriber-wise -- 13 million, or about 5% of the market -- but the carrier covers a massive amount of the Midwest, West, and Southeast. It also uses the same voice technology Sprint does -- CDMA.

The first generation of WiMax phones that Sprint releases are likely to be CDMA-WiMax hybrids, execs have said. If Alltel were using WiMax for its 4G network, Sprint and Clearwire might have been able to team up with them as roaming partners, which could have filled in parts of the country that Alltel might have built out faster. Now they can't.

We don't think that Sprint was counting on Alltel's help, and Alltel won't begin building out its new network for several years, anyway. But either way, this reinforces the challenge that Sprint/Clearwire face: They're going to have build their own network, with zero help from their telco colleagues.

See Also:
Is Sprint-Clearwire Doomed From The Start?
Sprint's WiMax Delays Will Make The '4G' Format War Worth Watching
Sprint, Clearwire Announce $14.5 Billion WiMax Deal, Terms

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34 Comments

Conrad said:
Hey, Dan. I thought that Alltel couldn't go with WiMAX because they don't have the right spectrum to use WiMAX, so they are left with using LTE, which is about two years behind WiMAX. You might want to check into that.
steve (URL) said:
Alltel even a factor in the US 4G (LTE vs WiMax) battle? They could be taken out with one little investment banking hiccup, no?

Bigger question may be who will eventually want
to buy Alltel for their customer base.

Also, can Sprint-Clearwire execute on the WiMax
buildout/rampup? How will they build mass-market demand for mobile devices which are currently >99% Wi-Fi enabled? Will WiMax signals be able to
adeuately reach inside of homes and offices - at 2.5/3.5GHz, the in-building penetration is an issue.

Plus... how long before demand builds for that kind
of bandwidth... EvDo isn't exactly taking the US
by storm, although it provides near-WiFi speeds
at $60-70/mo.
bobthegreat said:
From a global perspective, neither Sprint, nor Alltel, and not even both together are enough to make WiMax even close to relevant. AT&T or VZ maybe, but not Sprint.

note that VZ, AT&T, China Mobile, Vodafone have all lined up behind LTE. Pretty sure Telefonica and TMO and TIM will do the same. AMX and Orascom will follow. NOK-Siemens and Ericsson will pretty much define the next standard with input from these players.

It is game over for WiMax. The best they can achieve is to get some type of harmonization between 16e and LTE. I am sure intel will also try to create a common IP pool, but I am almost sure it does not have enough to bring to the party, which will be an Ericsson, NOK, Qualcomm party again.

my opinion is that the Intel guys started this Wimax thing believing that pushing adoption would be similar to what they did (very successfully!) with Wi-fi, based on their arrogance and total ignorance of the world of carriers. Billions after and multiple teams, they probably have learned but now "corporate inertia" and ass-covering efforts of the type you only find in highly profitable monopolies prevent them from just killing this dog. Can you just imagine how many people would be pissed off at Intel?

That aside, Ottelini should kill it! It is stupid!

EPS said:
Sprint's CDMA and EV-DO networks depend very much on an Alltel roaming agreement (Verizon roams CDMA but not EV-DO data) for coverage in more rural areas. This is a big hit to Sprint for getting customers who want to use service in rural areas.
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