Clearwire Will Never Be The Same Again

Once the poster boy for WiMAX, a 4G wireless technology thought to be the heir apparent to cellular, Clearwire (NAS: CLWR) is once more under Sprint Nextel's (NYS: S) thumb.

According to this Securities and Exchange Commission filing, Sprint has agreed to purchase more than 30 million Class A and B shares of Clearwire, bringing its overall ownership interest up to 50.8%. Comcast (NAS: CMCSA) and Intel (NAS: INTC) remain as minority shareholders.

Craig McCaw founded Clearwire in 2004, a decade after selling a pioneering cellular venture to AT&T (NYS: T) for $11.5 billion. He isn't making out nearly so well with Clearwire. According to the filing, Sprint is paying about $100 million for the bulk of McCaw's remaining interests, most of which are held by his investment company, Eagle River Holdings.

In selling, McCaw is at least tacitly conceding that Clearwire failed at becoming the disruptor he once thought it could be. "It really is about making the world a better place ... We think we can be a small part of that," he said in a speech at the CITA trade show in 2004, shortly after the company's founding.

A grand ambition, to be sure, but one that's gone unrealized. AT&T and Verizon's (NYS: VZ) wireless group have rolled out LTE networks to fill the gap that Clearwire had sought to occupy with WiMAX. Sprint isn't in any hurry to resuscitate the technology.

Fortunately, it doesn't have to: Clearwire, blessed with a huge inventory of excess spectrum, is overlaying its existing WiMAX network with a protocol called TD-LTE that should play nicely with Sprint's own LTE network, which promises users unlimited 4G data usage for a fee.

Now it's your turn to weigh in using the space below. Is Sprint right to be cuddling up with Clearwire again? Can they make for a viable alternative to AT&T and Verizon? Those aren't easy questions to answer, though we can be sure that the overall spread of fast wireless networks is helping boost demand for consumptive devices such as the iPad and Microsoft's (NAS: MSFT) soon-to-arrive Surface Tablet.

One of our star analysts sees a huge opportunity in these devices. Specifically, one of Mr. Softy's Surface suppliers, which is making a killing powering a range of inventive new wireless devices. Do you know this disruptor? A free special report has the name and all of our analysts' research -- click here to get your copy instantly.

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