Taking a flyer on next-generation wireless systems, Sprint Corp. (NYSE: S) says it will use mobile WiMax technology to create a high-speed wireless network that will serve 100 million subscribers by the end of 2008.

The firm is teaming up with Intel Corp. (Nasdaq: INTC), Motorola Inc. (NYSE: MOT), and Samsung Corp. on the massive project. Motorola and Samsung will provide mobile WiMax infrastructure and multi-mode devices for the network, while Intel will provide chipsets. All three will contribute undisclosed amounts of money for the infrastructure and marketing of this new network.

Sprint Nextel itself expects to spend $1 billion on the network in 2007 and up to $2 billion in 2008. That will enable the company to offer much higher data transfer speeds for broadband wireless users. Sprint Nextel CTO, and president-designate of the firm's new 4G unit, Barry West says users could see up to 4 Mbit/s on the downlink.

"I really believe that mobile broadband is going to completely change our lives," he told a packed press conference at the Westin Hotel in Times Square in New York.

West made no secret of the fact that Sprint aims to steal a march on its major competitors Cingular Wireless and Verizon Wireless . "We know there is a mobile data revenue opportunity out there waiting for the right technology to come along and grab it," West said.

The Sprint announcement comes as a blow to Qualcomm, which has developed its own proprietary broadband wireless technology based on WCDMA. The crop of WiMax startups that have invested heavily in developing WiMax equipment and making it work together has been a boost for big companies.

"The significance of this is it puts WiMax on a firm footing," says Paul Sergeant, director of WiMax systems marketing for Motorola. "In the same way that Sprint's selection of CDMA in 1996 made that a viable technology. Sprint is a very significant and stable carrier that will drive the development of WiMax and make it a fully commercial and fully viable solution that can provide lots of services."

Sprint may be the only large carrier in the U.S. that is capable of driving WiMax adoption in this way. The company owns 2.5GHz spectrum in 85 percent of the top 100 U.S. markets, according to Sprint CEO Gary Forsee. The carrier plans to start by using 10MHz channels of the spectrum to deliver services but may make those pipes even fatter in the future.

As it stands, no other major American carrier, fixed or wireless, can match this. In fact, some analysts have said in the past that this could give the operator a six- to twelve-month head start in deploying mobile broadband technology.(See WiMax USA: Spectrum Crunch.)

Sprint Nextel, however, needs to push its spectrum advantage after recently reporting poor customer growth -- compared to its rivals -- and a 38 percent drop in quarterly earnings for the second quarter. (See Sprint & Verizon Push 3G.)

Wall Street was not dazzled by the WiMax scheme: Sprint Nextel shares lost just under 2 percent of their value in heavy trading today, though a rebound was underway as the market closed.

For IT managers, the announcement means that "they have to start thinking about their applications as not just working inside the office building but as working everywhere the Internet is -- which is now everywhere," comments Sergeant.

The first mobile WiMax hardware in the U.S., which will likely be PC cards and WiMax-enabled laptops, are expected to be available as Sprint lights up its initial cellsites at the end of 2007. These single-mode devices will offer users faster data rates, but only in markets where Sprint has launched its 4G service. So Motorola and Samsung are working on dual- and multi-mode devices that will allow users to talk and download wherever they may roam. These are expected on the market in 2008.

— Dan Jones, Site Editor, and Richard Martin, Senior Editor, Unstrung