Dec, 01 2011

Clearwire has been on a heavy downward spiral as of late. Their WiMax network rollout was far more costly than they probably imagined and the interest payment of $237 million they had to pay today was not helping.

They looked to their WiMax partner Sprint for help. $1 billion might have been enough for them, though Sprint opened theirwallets up a bit more for Clearwire to start moving toward LTE and for general funding if they could raise $400 million on their own.

 

In all, Clearwire looks to get $1.6 billion from Sprint. We reckon they wanted to try everything in their power to settle their dire financial issue before going to Sprint for help. When rumors began swirling that Sprint would be their last bastion of hope I figured Sprint wouldn’t let them down considering how much was at stake.

If Clearwire is unable to operate their WiMax network, Sprint’s 4G customers are left in the dark. If Sprint’s customers are left in the dark, Sprint loses a lot of customers. And if Sprint loses a lot of customers, Sprint loses a lot of customers’ money.

This very situation is probably why they elected to do their LTE rollout in-house instead of going to their partner Lightsquared. In any case, Sprint and Clearwire have a working agreement through 2015 for WiMax, after which Sprint will have built their LTE network out to all of their consumer base. This would likely be the death of WiMax phones in America if Clearwire stays on track for their LTE plans as LTE has quickly become the dominant technology for 4G in the US. [via Engadget]