- The 20 Best iPhone/iPad Games of 2013 So Far
- 9 Steps to Build Your Personal Brand (and Your Career)
- 7 Consumer Technologies Coming to an Enterprise Near You
- 11 Signs Your IT Project is Doomed
Network World - So Clearwire has confirmed that it's looking to deploy an LTE network alongside its WiMax one, but there's a big catch: The service provider needs more cash.
In its quarterly earnings statement released this week, Clearwire said that any plans to build a new LTE network to complement its WiMax network "are subject to raising additional capital," which has been a problem for a company that has been losing money consistently for the past three years. What's more, the company says that it will need "substantial additional capital" to continue running its WiMax network "over the intermediate and long-term," although the company says it currently has enough capital to maintain and operate the network "for at least the next 12 months."
Clearwire's initial plans are to deploy LTE in markets that experience high levels of wireless traffic, presumably to provide some additional capacity to its biggest markets. Clearwire says it has enough spectrum to deploy both LTE and WiMax over the 2.5GHz band and says that it will use "ultra-high capacity spectrum configuration that is superior to the typical configuration of the slower, more capacity-constrained commercial LTE network designs in the United States of today." The company claims it has reached peak download speeds of more than 120Mbps in its trials of LTE technology.
Clearwire didn't say how much capital it would need to build out a new LTE network or who specifically would be providing the additional capital. In its financial statement, the company merely said that it was working on multiple fronts to secure additional capital for its new services.
"To address our need for additional capital, our management team and a special committee of our Board of Directors has been pursuing various alternatives for securing additional financing and, at the same time, exploring other strategic alternatives," the company said. "We are seeking additional financing from new strategic investors, which may include new equity or debt offerings. We may also elect to raise additional debt financing from other investors through public or private offerings."
Clearwire already made an agreement with Sprint earlier this to pay $1 billion for the right to wholesale access to Clearwire's WiMax network over the next two years. Sprint, which is a 54% owner of Clearwire, had been haggling for months over what it would pay the company for wholesale rights. This came at a time of significant turbulence for Clearwire, as the company acknowledged late last year that it would need a large capital injection in order to remain solvent.
Clearwire's operating expenses have soared over the past three years, going from $514 million in 2008 to $1.5 billion in 2009 to $2.8 billion in 2010. The company says that the vast majority of its capital expenditures over the past three years were incurred from network build-outs that have helped Clearwire bring its WiMax services to every major market in the U.S. Even so, Clearwire's revenue has failed to keep up with the increased operating costs, resulting in a $2.3 billion loss in 2010, nearly double the $1.25 billion loss posted in 2009.