Sprint's West: WiMax on Track

CHICAGO -- NXTcomm -- In his latest market update today at NXTcomm, Sprint Corp. (NYSE: S) CTO Barry West reiterated that the operator is on track to "soft launch" two WiMax markets in December 2007 and is keeping its options open vis-a-vis the wireless broadband business unit that is deploying the network.

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