Sprint's West: WiMax on Track
Unstrung button-holed West briefly after his keynote to ask about reports that Sprint may be considering a link-up with rival WiMax operator Clearwire LLC (Nasdaq: CLWR), a cable company partnership, or an outright spinoff, to further finance its $3 billion WiMax deployment. West stuck to the company line that the operator is considering at least some of those options as a possibility.
"We don't need the money; we can afford to build the network ourselves." he says. "The management team is looking at ways of unlocking value for shareholders." (See Sprint: WiMax Options Open.)
West says that Sprint has the "best spectrum position of any major carrier in the U.S.," but this "pole position" is not reflected in its current $22.08 share price. Indeed, the firm today also announced plans to buy some spectrum from Bell Industries Inc. for $13.5 million in cash.
So the company continues to consider ways to "unlock the value" of what West clearly sees as a precious asset.
The WiMax rollout is running to schedule, according to West. Chicago and Washington, D.C., will be launched in December 2007. Nineteen more markets will follow in April 2007, and the operator hopes to cover 100 million in the U.S. by the end of 2008.
West once again spoke of his desire to get WiMax into as many devices as possible. The company is already working with ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) and others to try and bring WiMax to a range of consumer devices.
This is crucial for West, as volume sales will help to drive down the cost of the WiMax chipsets so that the firm doesn't have to subsidize handsets as so many operators do today. He says the cost of WiMax silicon is $25 to $45 now and will drop further.
"If you don't get away from subsidies, then this model won't work," he says.
— Dan Jones, Site Editor, Unstrung
READ:
"Given the level of investment required, the significant risk inherent, as well as considering our poor performance and challenges in our core businesses, the shareholders and other coherent individuals, have indicated we need to get creative and find some way to fund what Intel, Motorola, Samsung and others are not subsidizing, and transfer those costs to others or onto another balance sheet, lest we wish to "spend more time with family".
"...on track to "soft launch" two WiMax markets in December 2007"
READ:
"While I will not be here in December, I am sure that one of our "test bed" sites can be used to declare a "soft launch" has been achieved. You guys understand that right? Cool. But lets face it, if it is not achieved it will clearly be due to a failure by the equipment vendors to deliver. But I have been assured by our suppliers that the schedule is on-track and that we will be very very pleased. x/x/
Keeping 'em crossed.
Again remember Sprint / Nextel has many objectives here and you need focus on the vision for now and not the details. We have been in the game for a long time, as have many of our friends, we know how to play the table - comprendere?. So work with me here for now, there is a time and place for everything. Look at history and you will find all you need to know. Let's not lose any sleep about it now -- ok? This is news, and that is good for you, so run with it. Gotta go the cjet is waiting...you are the man!