News

Clearwire Testing Mobile Telephony

3/21/2009 2:00 AM Eastern

Clearwire, the wireless-broadband company whose backers include Comcast and Time Warner Cable, has kicked off a trial of voice-over-IP phones in Portland, Ore., and is eyeing the launch of mobile voice services next year.

Clearwire will look at adding mobile voice to its product line in 2010, and has discussed working with its cable partners to offer mobile voice services and handsets as well, said chief strategy officer Scott Richardson.

“The plan this year is to test out the mobile VoIP handsets,” he said. “We're testing the usage model, and the integration with your home phone and the WiMax network, and how you hand off to a cellular network” like Sprint Nextel's 3G network.

The “new” Clearwire was formed last December, combining the legacy company's operations with Sprint's WiMax wireless business. The new entity has received a $3.2 billion cash investment from Comcast, Time Warner Cable, Bright House Networks, Intel and Google. The MSO partners have the option to buy WiMax access services on a wholesale basis from Clearwire.

Comcast has targeted Portland as the first market where it will offer WiMax service, by mid-2009. The service will be bundled with the operator's cable-TV, phone and home Internet services. Richardson said the MSO in not currently part of the mobile VoIP-phone trial.

Comcast spokeswoman Mary Nell Westbrook said no pricing or speeds have been determined for the Portland launch, and confirmed that the company's brand name for WiMax service has yet to be determined.

SECOND LAUNCH IN PORTLAND

Clearwire in January launched WiMax mobile-broadband service in Portland following Sprint's launch last October of service in Baltimore. The company does offer voice-over-IP service today — for a flat rate of $25 per month — but only through the home-based version of the service.

Richardson wouldn't disclose which handset manufacturers Clearwire is testing in its mobile-phone trials, but he noted that Samsung introduced a WiMax-based phone for the South Korean market.

The test could open the door for cable partners to offer their own wireless-phone services, as an extension of their wireline VoIP.

For example, Richardson said, “Comcast already has a managed VoIP infrastructure. That can just simply run over our network, without re-engineering.”

While voice is on Clearwire's road map, TV is not, according to Richardson. “The best use of Clearwire's network is to focus on the mobile element,” he said. “I don't think we want to stand up and say we do a better job of delivering video than the satellite guys or coaxial cable.”

Clearwire has about 18,000 cell towers in development nationwide, and intends to be up and running in around 80 markets by the end of 2010.

Las Vegas and Atlanta are next on the list, targeted for mid-2009 launches, followed by Chicago, Charlotte, Dallas-Fort Worth, Honolulu, Seattle and Philadelphia, plus a re-launch of its Baltimore market. In 2010, specific markets in the lineup will include New York, Boston, Washington, D.C., Houston and the San Francisco-Bay Area.

As for how those market launches are prioritized, Richardson noted that those decisions are “driven by what Clearwire thinks is best for our business,” while Sprint and the MSOs have input “at a board level.”

“Clearwire operates as a standalone company from our investment partners,” Richardson said.

The MSOs and Sprint will compete to some extent with Clearwire's retail services, Richardson acknowledged. But he said ultimately Clearwire and its partners are competing with 4G services from AT&T and Verizon Wireless.

“The way you have to look at this is, our wholesale partners have an obligation to bundle the WiMax service as part of an anchor service,” Richardson said. “In the Clearwire case, we'll offer standalone services for the user, and our bundles are all-wireless.”

LOTS OF SPECTRUM

Richardson claimed Clearwire has more wireless spectrum than either AT&T or Verizon Wireless. While those two carriers have about 22 MHz across markets, Clearwire has 120 MHz in most major markets, operating in the 2.5-2.7 GHz band.

“We don't even launch a market unless we have more than 30 MHz,” he said.

The WiMax operator advertises download speeds ranging up to 6 Megabits per second for fixed residential service and up to 4 Mbps for mobile users; the difference is that the residential WiMax modem has a bigger antenna.

Richardson said users will see peak speeds up to 15 Mbps, but “if you set an expectation like that for the user, you're marketing an over-expectation.”

The service from Clearwire — called “Clear” — is available in home, mobile and business plans. Home Internet service plans start at $20 per month; mobile Internet plans start at $30 per month; business plans begin at $55 per month and a 24-hour pass is available for $10.

Clearwire has not disclosed what it will charge partners for wholesale access to the WiMax network. Richardson said the pricing is usage based: “Ultimately we're just charging for bits of use, versus charging for applications.”

He added that Clearwire will not impose bandwidth-usage caps on subscribers, but reseller partners will have that latitude. For its wireline broadband services, Comcast limits subscribers' monthly usage to 250 Gigabytes.

Earlier this month, Kirkland, Wash.-based Clearwire announced the hiring of Bill Morrow, a former executive at Pacific Gas & Electric and Vodafone CEO, to be its CEO. Morrow replaced interim CEO Ben Wolff, who will become the wireless company's co-chairman, a position shared with current chairman Craig McCaw.

September