This Week in WiMax

12:15 AM -- This week in WiMax, here are the big issues, as I see them:

Clearwire shoots for 81,000 adds during fourth quarter
Now that Clearwire is finally seeing fit to break out its new-subscriber numbers (hooray! What a good idea!) for its nascent national WiMax service in the U.S., the question for the immediate future is whether or not the company can sign up 81,000 new subscribers this quarter -- to meet the self-proclaimed goal set by company CEO Bill Morrow. He felt confident enough to restate that target during this week's third-quarter earnings report. (We'll have some more thoughts about the company's capital-raising efforts in next week's column; for now let's talk about subscribers.)

Though Morrow toned down the message a bit -- sounds like he's got a new CFO watching what he says on the calls, eh? -- the company says it feels bullish after adding 49,000 new WiMax customers during the quarter, a surge that helped Clearwire to a total of 44,000 net new subscribers after deducting 5,000 folks who declined to renew their previous Clearwire contracts. Morrow's quote from the call transcript (thanks, Seeking Alpha) says it pretty plainly: "Our customer uptake in Q4 has continued to be robust. Despite Q3 being such a strong quarter, expectations for Q4 are to generate about the same level of subscriber acquisitions than in our first three quarters of the year combined."

As we've said before, the recent launches of Clearwire's biggest-ever markets -- namely, Philadelphia, Chicago, and Dallas/Fort Worth -- should go a long way toward helping the company reach the goal of 900 new subscribers a day, which is roughly what Clearwire needs to meet Morrow's subscriber-addition mark. (Our back-of-the-envelope math shows Clearwire with 81,000 net subscriber adds from the first, second, and third quarters combined -- divided by 90 days gives the rough estimate of 900 needed per day.) The wild card in adding up numbers will be how many customers are added through reseller channels, especially from the big reseller partners Comcast, Time Warner Cable, and Sprint, who are also now selling in many more markets than before.

Unfortunately, Morrow didn't break out the wholesale numbers for the third quarter, calling them too premature for financial analysts to build a stable model on top of. We still call that hedging off a potentially embarrassingly low number, albeit in language that is much nicer to Wall Street's ear. Maybe we'll get more clarity when fourth-quarter numbers are reported in February. Especially if Clearwire and its partners can find 900 new customers a day between now and then.

Need to know more about Clearwire and WiMax? Our second version of the "Clearwire NTK" report, which covers Clearwire events from June through September, costs less than a large beer at the local Sprint Nascar race. Just $4.95 at the Sidecut store. Also available for the Kindle. Available now for free download is our "WiMax Business Deployment Guide."

— Paul Kapustka is the founder and editor of Sidecut Reports, a WiMax analysis site and research service. He can be reached at [email protected]. Special to Unstrung.

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