Intel Says WiMax Is Not Dead Yet

Intel Says WiMax is not dead yet

The cancellation of the WiMax partnership between Sprint Nextel and Clearwire leaves the broadband wireless technology looking to many like the Black Knight from Monty Python and the Holy Grail ("It's just a flesh wound!"). But it's still too early to stick a pin in the future of WiMax, particularly if you listen to major backers like Intel.

"The news from Sprint and Clearwire today does not change Intel's plans nor its commitment to WiMax or to our relationship with either company," says Intel spokesperson Kari Aakre in an e-mail. At the Intel Developer Forum in San Franciso in September, the chipmaking giant reaffirmed its WiMax plans, saying the first half of 2008 will see laptops and mobile devices powered by WiMax-capable silicon.

In announcing the "mutual agreement" to terminate the Clearwire association, Sprint reaffirmed its commitment to an end-of-year lighting-up of WiMax networks in several U.S. cities, including Chicago and the Washington/Baltimore area. But what the CEO who eventually replaces the departed Gary Forsee will do about WiMax is anyone's guess. One possibility: a spin-off of the WiMax unit, dubbed Xohm. In fact, Xohm might actually fare better as an independent company, not chained to the dying beast that is Sprint's core cellular service.
"I believe that Sprint will spin off the WiMax unit," said Craig Mathias, principal at the Farpoint Group and a leading wireless analyst, in an interview. "The commercial launch next year will take place under the auspices of a broader entity."

The end of the Sprint partnership is a heavier blow to Clearwire, which lost a quarter of its market value on the news and reported a loss of more than $328 million for the third quarter. Ironically, Clearwire's business has been expanding healthily this year: the Kirkland, Wash.-based provider has added 90,000 subscribers in the last six months, growing at better than 25% per quarter.

In fact, with the participation of Intel and other high-tech warhorses like Google, WiMax may simply have too much momentum and money behind it now to be derailed even if Clearwire falters and Sprint bows out of the business. It's rumored that Intel and other deep-pocketed Silicon Valley companies will bankroll WiMax startup Clearwire to keep its build-out on track. Revenue from the WiMax equipment market will grow to more than $3.3 billion, according to Gartner, with 48 million connections worldwide by 2010. The technology is growing rapidly overseas, particularly in developing countries that lack legacy infrastructure. Last month the International Telecommunication Union, a United Nations agency, endorsed WiMax as the mobile technology of choice for wireless broadband.

Hey, if the UN's behind it, it can't fail -- right?