Clearwire's Pricing Window Is Wide Open

The real advantage Clearwire LLC (Nasdaq: CLWR) will have over upcoming Long-Term Evolution (LTE) deployments will lie in offering an unlimited fast mobile broadband data service at a lower cost than the rival "4G" technology.

The Kirkland, Wash.-based operator has just launched in Nashville and confirmed its operational status in NYC and San Francisco. Monthly unlimited data service that can roam between Clearwire's mobile WiMax network and the Sprint Corp. (NYSE: S) 3G network is being offered for $55.

Clearwire has also just launched its Rover prepaid service, which offers a personal hotspot for $150 and service for $5 a day, $20 a week, or $50 a month.

Heavy Reading senior consultant Berge Ayvazian says this will be a key difference between Clearwire and the early LTE services launched by Verizon Wireless and MetroPCS Inc. (NYSE: PCS). "Clearwire may have a pricing advantage for at least another year," he tells LR Mobile.

Indeed, executives from both MetroPCS and Verizon have said that they expect to be able to charge a premium for LTE services. MetroPCS currently offers monthly plans between $40 and $60 for handsets, while Verizon offers 3G laptop data plans at $40 for 250 Mbytes of downloads and $60 for 5 Gbytes. (See Verizon's LTE: How Much More $$ Than 3G? and MetroPCS LTE Net May Launch in September.)

Ayvazian expects that Verizon could initially charge a $10-to-$15 premium over 3G for LTE. The carrier has also talked about the possibility of tiered pricing for LTE.

WiMax devices are also likely to be cheaper than LTE gizmos for the time being. "Initially there will be at least a double premium on LTE devices, and it could be as much as five times as costly on USB modems," Ayvazian notes. The analyst, however, notes that operators may eat some of the up-front costs of LTE devices by subsidizing them.

— Dan Jones, Site Editor, Light Reading Mobile

joset01 12/5/2012 | 4:23:36 PM
re: Clearwire's Pricing Window Is Wide Open

The Sprint/Clearwire spectrum footprint also means that they can stay unlimited on Wimax -- whatever LTE they move to  -- for the foreseeable future. Berge says that they have 4X the spectrum as Verizon has for LTE at present.

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