Clearwire's Ben Wolff: WiMax a 'value proposition' in a down economy

CEO optimistic about WiMax rollout despite tough times, touts firsts such as live video chat

CHICAGO -- Even as technology stocks have taken a beating amid the recent market upheaval, Clearwire Inc. is "positioned to ride out the storm" as it joins Sprint Nextel Corp. in a nationwide WiMax wireless rollout, Clearwire CEO Ben Wolff told Computerworld today.

While Clearwire's stock price has fallen along with other technology stocks, Wolff said Clearwire is expecting an infusion of $3.2 billion in cash from Google Inc. and other partners as soon as the $14.5 billion joint venture with Sprint Nextel Corp. is approved, as expected by the end of the year. Once approved, Wolff will be named CEO of the new Clearwire.

Wolff said it would cost about $7 billion in all to build a nationwide network that is expected to reach 140 million people in major U.S. cities by the end of 2010. He said the $3.2 billion from Google and others would "last a long time."

Sprint launched its Xohm WiMax network in Baltimore on Monday, and is expected to soon launch it in Chicago and Washington. Other markets will follow in the coming year. Those markets will be folded together with holdings of Clearwire, which has pre-WiMax technology in more than 40 smaller cities and towns, and a WiMax network in Portland, Ore. Clearwire has nearly half a million customers in total, Wolff said.

Wolff talked about the value of fast wireless access using WiMax as Clearwire employees ferried this reporter around the south side of Chicago in a minivan equipped with PCs that were using Samsung air cards to access the Chicago WiMax network, which was provisioned with about 600 Motorola Inc. WiMax antennas.

In a 15-minute ride, monitors inside the van showed access via WiMax to music and live television, as well as Internet access to Google maps with location technology. The WiMax network was also used to place a VoIP phone call from the van. In all, the quick circuit around town involved passing by eight different WiMax antennas, but all the connections were constantly kept, with download speeds sometimes exceeding 5Mbit/sec.

With that successful demonstration to bolster his predictions, Wolff said he believed a true killer application of WiMax will be the ability to conduct live video chat from a handheld device. "The ability to have face-to-face communications will be possible," Wolff said.

Wolff also said there will be many devices connecting to WiMax networks, from small handhelds to laptops. He said Google's open mobile platform, Android, introduced on board T-Mobile's G1 handset last week, will also be used for WiMax devices.

Google, one of the major investors in the joint venture, won't just be working with WiMax in its Android initiative. But, Wolff said, "Google will have a role, and it's across the board." He noted the company's reputation for search and Internet advertising, as well as its interest in Android and even its new Web browser, Chrome.

He said affordability is just as important to the coming WiMax network as devices and applications. Households will have a number of devices, with each person given a separate phone number and unlimited usage over WiMax for $125 a month, Wolff said. Similar but slower cellular services typically cost $300 today.

While Wolff noted that Clearwire was operating with plenty of cash as it began formally working with Sprint on WiMax, he also acknowledged that the economy would have an impact on WiMax's use. With the pricing envisioned for WiMax, including offers like Sprint's no-contracts, $10-per-day cost, WiMax "becomes a value proposition" compared with other means of communicating, Wolff said.

He expressed optimism for the economy too. "The current conditions are so dramatic, especially in terms of the shutdown in terms of the debt side, that it can't last," he said. "We're finding that this is a world economy, which is more apparent now than in the past."

Still, he said, the problems facing lenders and borrowers and investors won't undermine the value of the new technologies being researched and introduced at a remarkable pace, especially in the U.S. "Intellectual property has become our tremendous national resource," Wolff said.

Even though members of the GSM Association and GSM operators are expected to fight WiMax in the next few years, Wolff predicted a day will come when the next generation of GSM, called LTE (Long Term Evolution), will interoperate with WiMax. Asked whether there will eventually be a single phone that will function on both LTE and WiMax, he said "absolutely."

But Wolff also said that LTE has a long road ahead, while WiMax is already being rolled out. Wimax was expected to launch in 2006, and he said there could be similar delays with LTE. "LTE isn't even a standard yet," he said.

Copyright © 2008 IDG Communications, Inc.

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