Sprint buys Clearwire outright to get hold of its spectrum Ghz

December 17, 2012
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sprint-4g-lteThe negotiations seem to have been relatively short for Sprint to buy the almost 50 percent stake in Clearwire that it does not currently own. Rumors started to emerge a couple of months ago that Sprint would like to buy up the rest of the controlling shares and complete the takeover which started back in 2008 when Sprint bought more than 50% of Clearwire. The deal, which is worth $2.2 billion and values Clearwire at $2.97 a share, is all about airwaves.

With the world’s mobile telecommunication¬†networks¬†moving to 4G and the demand for high speed downloads increasing, who owns which bits of the airwaves is becoming critical for the success of mobile network operators. With the purchase¬†Sprint will be able to use Clearwire‚Äôs 2.5 GHz spectrum assets. Clearwire owns 160MHz of wireless spectrum across some of the largest markets in the United States¬†covering more than 130 million people.

Part of the deal includes funding to allow¬†Clearwire to continue its LTE roll-out and complement Sprint‚Äôs existing¬†LTE deployment.¬†Clearwire‚Äôs spectrum, when added to Sprint‚Äôs, will give Sprint¬†an “enhanced spectrum portfolio” which will be used¬†solely¬†for 4G.

Sprint is in the process of being bought by¬†Japan’s¬†SoftBank and it is thought that part of Sprint’s attractiveness to SoftBank was the possibility of controlling, or¬†purchasing¬†outright, Clearwire’s¬†spectrum¬†licences. At the moment¬†Sprint is the USA’s third largest carrier after Verizon¬†and AT&T.

It is also interesting that the low 2.5 GHz frequency controlled by Clearwire can be used for a type of 4G called 4G LTE TDD, a technology that SoftBank uses in Japan.

What this all means in a nutshell is that Clearwire’s¬†11 million subscribers are now part of Sprint and that Sprint has more 4G capacity. Let’s hope that this means that 4G will become more pervasive and cheaper in the USA.

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