updated 03:20 pm EDT, Fri October 9, 2009
Intel deal forces Clearwire to stay WiMAX
National 4G provider Clearwire is bound to keep using WiMAX for its network until at least 2011, an SEC filing discovered this week has found. The carrier is now known to have struck a deal with Intel that requires it use WiMAX for at least the next two years in exchange for marketing help from the chipmaker. Clearwire also has to share revenue whenever the subscriber's device is Intel-based as well as pay a limited number of activation fees.
The document obtained by Unstrung shows Intel effectively controlling a small but significant portion of the 4G market and implies that Clearwire may seek an escape from the terms once the period is over. The filing warns that it has to stay with WiMAX even if "technologically superior or more cost effective" options come along and worries that the hardware won't continue to exist.
"We cannot assure you that… vendors will continue to develop and produce mobile WiMax equipment and subscriber devices in the long term," Clearwire said.
The provider has maintained that it's still committed to WiMAX but has lately sent signals that it's willing to switch to LTE (Long Term Evolution) and can do so relatively easily if necessary.
Intel as the key creator of WiMAX has tried to encourage its use but has increasingly faced roadblocks to the standard's acceptance. It remains relatively popular in South Korea but has struggled to get much acceptance elsewhere as most carriers have instead opted for either more advanced 3G services like HSPA+ or to wait for LTE for their 4G. WiMAX has struggled primarily as it's a data-first service that wasn't explicitly designed for voice, unlike LTE, and has also had the advantage of its 12Mbps maximum speed eroded by HSPA+ (21Mbps) in addition to LTE (100Mbps).
It's not known if Sprint is under a similarly binding agreement.