CES: Intel – We 'Still Believe in WiMax'

LAS VEGAS -- 2009 International CES -- Intel Corp. (Nasdaq: INTC) is making it clear that its support for mobile WiMax technology is still strong, despite announcing a fourth quarter write-down related to its investment in wireless broadband operator Clearwire LLC (Nasdaq: CLWR).

The chipmaker has put plenty of marketing money and muscle behind 802.16e WiMax technology in recent years and is the largest single investor in the "new" Clearwire deal that closed at the end of November. Intel provided $1.6 billion of the $3.2 billion that is being pumped into the funding of Clearwire's WiMax plans.

The chipmaker said Thursday that it plans to take a $950 million non-cash charge in its fourth quarter because Clearwire's stock value has fallen below $5, off from a 52-week high of $18.26, according to Yahoo Finance. Investors Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) are expecting similar, but lesser, charges due to their investments in Clearwire. (See TWC Whacked With $15B in Charges.) Even so, here at CES, Intel is still showing confidence -- at least outwardly -- in WiMax's prospects, as you might expect given the silicon giant's instrumental role in pushing WiMax in the wireless world.

"Economic conditions notwithstanding, we still believe in WiMax and think it is the preferred 4G solution," Julie Coppernoll, director of marketing for the WiMax Program Office at Intel, tells Unstrung.

Many of the more traditional cellular infrastructure vendors and carriers have, of course, gone the other way and are backing Long-Term Evolution (LTE) as the future for so-called 4G communications.

But WiMax, as Intel has said before, is here now and ready to go. Clearwire and Sprint Corp. (NYSE: S) have the technology up and running in Baltimore and Portland, Ore., and plan to launch a number of other markets this year. LTE deployments from Verizon Wireless are expected late 2009 at the earliest and will likely continue at least through 2012. (See Analyst: Clearwire Will Launch Nine in '09.)

"Even in this economy, WiMax is a less expensive solution," Coppernoll claims, citing the "WiFi model" that Intel, Clearwire and Sprint are offering with pay-as-you-go connections as opposed to monthly contracts.

Intel is also expecting the first wave of laptops with its embedded WiMax/WiFi "Echo Peak" chipset to arrive this quarter. Unstrung has seen it working WiMax laptops from AsusTek Computer Inc. and Dell Technologies (Nasdaq: DELL) at the show. Intel is expecting eight OEMs in all to deliver WiMax-enabled laptops.

Some will arrive "earlier in Q1, rather than later," Coppernoll states.

Intel is hoping that the embedded WiMax, along with Clearwire's easy payment terms, will encourage users to upgrade to WiMax laptops even if they don't intend to use WiMax full time.

"It makes sense for me to consider it, even if I'm just an occasional user," suggests Coppernoll.

Of course, it would help to have WiMax available in more than two U.S. cities. Some analysts predict the next market launch will come late in the second quarter. No word yet on which city will get unwired, but Clearwire has previously named Vegas as a 2009 rollout candidate.

— Dan Jones, Site Editor, Unstrung

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