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Clearwire preps a mobile WiMax service launch in Spain next year and picks Alvarion and ZTE to supply the infrastructure
October 6, 2009
Clearwire LLC (Nasdaq: CLWR) said it plans to launch mobile WiMax services in Spain next year, proving that its proto-4G wireless broadband ambitions go beyond U.S. borders.
Clearwire will deploy WiMax 802.16e infrastructure equipment from Alvarion Technologies Ltd. (Nasdaq: ALVR) and ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) in Malaga and Seville, respectively, for service launches in 2010 in the 3.5GHz frequency band. And just as in the U.S., the services will be offered under the Clear brand.
"We intend to prove that WiMax can work not only at 2.5GHz, but also at 3.5GHz, which is the spectrum we have in Spain," Barry West, president of Clearwire International, said during a press conference at the ITU Telecom World 2009 show in Geneva. (See Barry West, President, Clearwire International.)
In Spain, Clearwire enters a highly competitive mobile broadband market. The U.S. WiMax operator will take on several of Europe's largest mobile operators -- Orange Spain , Telefónica SA (NYSE: TEF), Vodafone España S.A. , and Telia Company 's Yoigo -- as well as the country's fixed broadband providers like ONO and Jazztel plc .
All of Spain's mobile operators have launched 3G HSPA services with downlink speeds up to 3.6 Mbit/s, according to the Global Mobile Suppliers Association (GSA) , and Telefónica has launched 3G services up to 7.2 Mbit/s in some areas. Telefónica also plans to start trialing Long Term Evolution (LTE). (See Telefónica Kicks Off LTE Trials.)
Clearwire "will have to have a very low-cost strategy and fill in the gaps where the big guys don’t want to compete,” says Stela Bokun, analyst at Pyramid Research . “If WiMax [operators] target rural or high-density areas where Telefónica and other big players do not want to invest or are not providing high quality of service, those may be places where they’ll have more success.”
But Clearwire will compete not only with the mobile operators, but also with fixed broadband offers in the country as well. “It’s important to consider how successful it will be against fixed broadband, in particular with [fiber-to-the-home]-based broadband access, which is likely to see a strong expansion in the Spanish market over the next five to seven years,” says Bokun.
Spain's fixed broadband penetration stood at 21.3 percent at the end of 2008, according to Pyramid, which is five percentage points below the Western European average.
The new WiMax deployment plans will not be Clearwire's first foray into Spain or Europe. Clearwire already offers a fixed wireless broadband service in Seville, which launched in September 2007, but today's news marks the operator's first investment in mobile WiMax in the country. When the service in Seville launched, Clearwire said its network covered 300,000 homes in the city. (See Clearwire Goes to Spain.)
And Spain could be just the beginning of a broader European plan for Clearwire. The company has 3.5GHz licenses in Belgium, Germany, Ireland, Poland, Romania, and through its affiliate in Denmark, Danske Telecom A/S . Clearwire's European customers at the end of March 2008 totaled just 51,000 in Brussels and Ghent, Belgium; Dublin; and Seville. (See Clearwire in Euro Partner Talks, Clearwire Invests in Europe, Clearwire Goes European, and Clearwire Expands in Europe.)
Pyramid's Bokun thinks a European expansion for Clearwire could make sense.
“In terms of cost savings, it’s not a great idea to keep sporadic operations in random European countries, as this strategy does not allow for operational and other synergies; however, it makes sense for an operator to diversify its revenue sources, especially in an unstable economic environment," she says. "WiMax is still in its infancy, and the main WiMax operators are still testing the waters in different markets.”
— Michelle Donegan, European Editor, Unstrung
Michelle Donegan is an independent technology writer who has covered the communications industry for the last 20 years on both sides of the Pond. Her career began in Chicago in 1993 when Telephony magazine launched an international title, aptly named Global Telephony. Since then, she has upped sticks (as they say) to the UK and has written for various publications including Communications Week International, Total Telecom and, most recently, Light Reading.
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