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Cable companies in talks with Sprint to fund WiMax

By Brad Reed
March 26, 2008 12:00 PM ET

Network World - Time Warner Cable and Comcast are negotiating a deal to invest in a new nationwide WiMax company that would be jointly operated by Sprint Nextel and Clearwire, according to reports in the Wall Street Journal and the Washington Post.

Citing anonymous sources, the newspapers report that Comcast would invest US$1 billion and that Time Warner would invest up to $500 million to help the new company create a nationwide 3G network based on WiMax technology. Sprint CEO Dan Hesse is pushing for the negotiations to finish in time for next week's CTIA show in Las Vegas, the Journal reports.

Sprint and Clearwire had previously signed a letter of intent to jointly build out a nationwide WiMax network last summer, but then called off their plans months later, as the companies said they "could not resolve complexities" involved in the original plan. Former interim CEO Paul Saleh told an investor's conference last year that the original plans with Clearwire fell apart because having a WiMax network split between the two companies had simply become too complicated, and the companies were worried that it might confuse customers. So far, Sprint has dedicated roughly $5 billion to rolling out WiMax nationally.

Ever since then, both Sprint and Clearwire have been rumored to be negotiating a new deal to build out a nationwide WiMax network with help from outside investors. In addition to Time Warner and Comcast, Intel has been rumored to be a potential investor in the new joint venture. Intel and Clearwire have a history of working together on WiMax-related projects, and Intel announced earlier this year that it would integrate WiMax into its new Montevina mobile platform.

A major investment by Time Warner and Comcast in WiMax wireless Internet technology would further raise the stakes in the cable companies' rivalry with telecom carriers Verizon and AT&T, which have each been aggressively promoting their FiOS and U-Verse services as alternatives to traditional cable television and Internet. A report issued earlier this year by researchers Information Gatekeepers projects that telcos will be able to match the total number of high-speed accesses offered by cable companies by 2011.

Reprinted with permission from NetworkWorld.com. Story copyright 2012 Network World, Inc. All rights reserved.
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