Clearwire's Upgrade Issue

6:00 PM -- There's one bump in the road for Clearwire LLC (Nasdaq: CLWR)'s plan to convert some fixed wireless markets to mobile WiMax this year: Existing customers will need a new modem to use the new service.

The old Clearwire fixed wireless service is not actually WiMax, so it won't receive transmissions from new 802.16e mobile WiMax basestations. Almost all of Clearwire's network currently uses NextNet fixed wireless technology to provide connections to users' homes.

The issue of how to move existing customers to the new network will come more into focus in the coming months. Clearwire is bringing mobile Wimax to its existing Seattle market in the later half of this year.

According to the Seattle Times, the company isn't yet saying exactly how it will migrate users to the new network, but that it won't switch off the fixed wireless links for a while at least. A company spokeswoman tells the paper that it "will make the new service and devices as attractive as possible for our existing customers."

Unstrung has spoken to some analysts that expect the company to essentially give away the new modems to make the new service attractive to old users. It is not yet clear, however, what Clearwire will actually do.

— Dan Jones, Site Editor, Unstrung

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