updated 01:00 pm EDT, Tue April 19, 2011
Sprint commits min of $1b in 2 years to Clearwire
Sprint and Clearwire have come to a new agreement that required them to settle a previous dispute over wholesale pricing. Under the new deal, Clearwire will receive a minimum of $1 billion over the course of the next two years from Sprint in exchange for access to its high-speed WiMAX network for mobile devices. The deal comes at a crucial time for Clearwire, as it was trying to raise capital as early as late last year.
"It allows us to plan for our expansion," Clearwire interim Chief Executive John Stanton said, commenting on the deal.
The agreement will see Sprint pay $300 million in 2011 and $550 million in 2012. Another $175 million is earmarked for use over the next two years and farther into the future. These are the minimum numbers, and if usage exceeds expectations, they will pay more.
The money will be put into expanding the 4G service into more markets across the US. More money will be needed if a second variation of the network is to be developed and more widely adopted in the industry. [via Wall Street Journal]