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Clearwire Corporation (CLWRD) Message Board

  • teamrep teamrep Feb 13, 2013 1:46 PM Flag

    Who is a 'Good Steward' of the Spectrum in the eyes of the FCC or industry writ large?

    The primary edict of the FCC is to see that spectrum gets used to its best advantage to serve the variety of needs from government and military services, public safety, medical, satellite, marine, as well and commercial wireless services. Given that, Sprint has used a small part of the joint venture that formed New Clearwire while Clearwire itself has poorly used the spectrum. The measure is simple: How many people are using the spectrum? Answer: 1.4 million Clearwire subscribers, vs. 9 million Sprint. Both of these numbers are dwarfed by those of the mainstream operators other networks, including the distant third string player Sprint. From a measure of how much of the ~150MHz of spectrum has been put to productive use, Sprint-Clearwire failure to measure up, with Clearwire itself looking rather putrid.

    Where Clearwire looks somewhat better is as the pioneer of the new field of technologies: they were the first large scale mobile pre-4G operator. However, compared to YOTA, Packet 1, and others, the degree of innovation ushered in by Clearwire looks, well Clearlywired. Clearwire has not been a technology innovator. The basic ways of spawning innovation starts with trying... one way for a company that wants to enter mainstream markets including through mainstream operators who have incumbent turf to protect and incumbent brain-dead ways inertia to overcome, is to do pilots. Even IBM did this with the first PC.. it was initially invested with $14 million budget and discarded junk-works facilities with a basic mandate to buy-in rather than spend the typically much larger capital that would have been needed. That is a major reason why IBM came to Microsoft and came to use a modified version of Seattle Computer's 16 bit 86 DOS.. IBM's PC start-up wanted to do the PC on the cheap as a hacked together assemblage of hardware and software. Where was Clearwire's 'skunk works' to try out small cell, mobile devices, vertical markets and then use what works best as similarly lean operations?

    Was that because it was constrained by Sprint? Certain factors argue for that. Or it could be just general lack of innovation that grew out of the success of the industry and patterns of business of the WBA 'industry' that now looks like burnt toast in the wake of standardization of 3G-4G WBB.

    Basic questions that Joan and others should have asked.. which were discussed here from the start, are what are the cost basis for delivering the service? This starts out with a few basic metrics: cost to deploy and acquire per subscriber. That brings it down to something everyone should understand: the cost of building the network and then selling it and delivering the devices/modems into the hands of subscribers must be low so that the pay-back and profitable is achieved in a competitive time-frame and degree. If the cost is too high, the revenue too low, or the number of subscribers is too low to pay off the current network and pay back debts, you might as well distribute the capital paid in and shut the doors because the business model will not work out. If the analysis leads to such a determination soon enough, then the questions about 'what the heck can we do to lower costs, decrease cost of acquisition, make the service more attractive to a broader range of users or, alternatively, much more entrenched with subsets of users' can be pursued in time to head the titanic operational budgets away from the rocks. To their credit, Stanton, Erik, and Hope et al have tried to avert heading toward the cliff by trimming costs and engaging in some innovations in marketing. However, this came too late and too little to matter. Perhpas if Clearwire had their own mobile phones and pads would have made a difference. However, Clearwire waas never a mobile device company by itself. Why not a 'skunk works' buy-in of similar Samsung, HCT devices used by YOTA, Packet 1 and other 'WiMAX Mobile' operators? Couldn't those devices have been modified and gotten into the market 2-3 years ago? Those were questions to have asked while there was time for them to have had an impact, not after the chips have fallen. Similarly, small cell has become all the rage... everyone is talking up small cell and Sprint is among the most prolific deployers in the US.. with AT&T, metroPCS, Verizon, everyone else also using them. When it comes to innovation, Verizon, AT&T have done more in small cell than Clearlywired... which is a blasphemy to the notion of WiMAX being an 'innovative technology' or Clearwire being a technology innovator. Who needed to be the 'skunk works' style innovator, those with marketshare already developed or the challenger?

    So what exactly was Sprint's role in how much Clearlywired innovated, didn't have their own mobile phones, cobbled their rate plans and didn't pursue the initial plans for spot-sales of hour-day-week-month service plans, and earlier use of market innovators like Earthlink, FreedomPop? We probably will never know exactly how or why decisions were made and it does not much matter except as another of the 'lessons learned'. Among those lessons is the lesson that investors are chumps from the start who must be cautious and seek protection for fancy technology companies full of promise. How are you pursuing the big promises? Shouldn't you have mobile phones after 2, 3, 4 years? Whadup wid dat? The time to get insistent that more be done is while there is time left, money left to actually do something.

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    • Take a look at the recent petitions to the FCC from EBS holders. Spelled out in these documents is a basic issue that has come back around, it eventually would have: that Clearwire has made very little use of the spectrum and, its asserted almost no use to the benefit of the EBS license holders:

      "This analysis and the data at Exhibit 1 demonstrates that notwithstanding Clearwire
      commercially deployed WiMAX services in most of these markets over two years ago (and in
      some cases over three years ago), and commercially deployed pre-WiMAX services in many of
      these markets years before they re-deployed WiMAX services, the reality is that Clearwire’s
      provision of services/capacity for educational usage is practically non-existent (an average of
      less than one hundredth of one percent of customers in these 20 markets and zero educational use
      customers in 5 markets) – notwithstanding Commission requirements on the part of Clearwire as
      lessee of the EBS spectrum to comply with FCC rules, including minimum educational usage
      requirements for EBS spectrum.
      14
      Based on this data, it does not appear Clearwire has complied
      with Commission educational usage obligations for the EBS spectrum it leases, let alone the
      Commission’s intent and vision for educational usage of EBS to promote the educational
      missions of U.S. educational, nonprofit and religious institutions."

      This is a crucial factor. I doubt that the FCC will rule to hold out all of the EBS spectrum and the counter arguments in favor of the roll-up by Sprint-SB include that they will be a well funded, more comprehensive operation that is able to make extensive use of the spectrum. However, da facts are da facts: Clearwire has failed to exploit the spectrum, failed to involve EBS license holders directly, failed to use small cell on campuses that might have led to greater use for intended EBS purposes... and other such things that bring continued lock-in of the spectrum in question. What if they had shifted away from WiMAX earlier? What if there had been a small cell strategy including what had been suggested for campus use that would then be extended as the wide area networks were deployed? All those things now come back to pose a threat to Clearwire's retention of rights to the spectrum whether it is sold off to Sprint-SB, retained or sold to someone else like DISH. What the Catholic Dicoese of Erie, PA claim is aimed not just at Sprint-SB's roll-up but directly at Clearwire's failure to make much use of the spectrum via their brain-dead macrocell only technology-smechology bias. Clearwire has aimed development at the macro-scale while the market, particularly the EBS license holders wanted a local, campus, micro-scale participation. They now use this as an argument against continued control by Clearwire which impedes not just the Sprint-SB acquisition but any other as well. What do you think DISH/Ergen must make of this? That a) any deal they do with Clearwire must be for cleared spectrum, otherwise its use could be taken away from them if the FCC rules unfavorably, b) the overall value is further put into question.

      I think that this will work itself out and that the C. Diocese's complaints will be assembled within the full context rather than ruled on directly. However, the impact furthers the concept that the FCC will spin out part of the spectrum, most likely EBS spectrum, to be held open for use outside of Sprint-SB. Since the arguments lining up hinge on the fact that Clearwire has not made much use of the spectrum that has proven attractive to users or EBS license holders in particular, the pressure is to reduce Clearwire's value in the spectrum. In any case, the activity tends to pull control of whatever happens out of Clearwire's BOD and management and into the arms of FCC and DOJ to determine at least a part of the spectrum's fate before anyone can move forward.

      "We want it to be simple.. for Clearwire to be the decider as king of spectrum." Its is not apparently so.

      • 2 Replies to teamrep
      • In the 74 page response with no less than 184 footnotes / references / comments to the Catholic Diocese of Erie, PA and others SPRINT said they (Catholic Diocese )were simply looking to change the lease terms they had agreed too and that Clearwire had met all requirements. Additionally, the HITN has refuted almost every point directly made by the Catholic Diocese of Erie, PA and said Clearwire has done much more than meet the minimum requirements.

        Read and yes interpreted.

      • That's just a load of hogwash, particularly "the pressure is to reduce Clearwire's value in the spectrum".

        The entire statement is just screwy...there was no valuble spectrum block until the founder/Clearwire did the work and put it together creating value, otherwise it would simple be a bunch of individual small spectrum slivers which couldn't be used for any of the coming wireless applications. Secondly, the only "pressure is to reduce Clearwire's value in the spectrum" is in your mind and the companies trying to buy it. The FCC cannot use some magical eminent domain and simply confiscate the spectrum...they would not simply be taking it from some poor performing Clearwire management, they would be taking the initial value creation which the owners of the spectrum (public investors) have investments. Courts simply could not allow confiscation by big brother FCC, however they could certainly require sale of it, if the mandates haven't been met. Your statement that Clearwire may not be the sole decider is decidedly accurate, but the rest is nonsense.

    • Omg this dude has no life

      • 2 Replies to incognito9998
      • "The courts would not allow.. ' blah, blah blaaawrooonggg

      • Hey, I'm reporting what is posted on the FCC website. There are pro and con petitions as I mentioned. The impact is what, to increase the control Clearwire has over determination of the spectrum? I don't think that a process that is considering how to treat the spectrum is pro-control of Clearwire by its very nature. It either is aimed at shifting control over to Sprint-SB or breaking out spectrum. Why not talk about the FCC petitions and your own ideas rather than bash my ideas.... do you have a brain of your own and two eyes?.. then either don't comment or counter what I wrote with something more than denouncing an opinion. Like I said, I don't know what the outcome of these hearings will be and its likely the petitions will be considered in the broader context... However, 'the media is the message' - this process, for the time being, takes this out of the hands of Clearwire, Sprint-SB.

        You can stik your head in the sand if you wish.. Don't shoot the messenger..

    • "The primary edict of the FCC is to see that spectrum gets used to its best advantage to serve the variety of needs from... Basic questions that Joan and others should have asked..."

      Zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

    • There's been no deliberate and purposeful plan to methodically unlock the value of what they have. That's for sure. Whether that was because of Sprint's influence or just plain lack of experience or even ineptitude, is not clear. Over the last four years I am sure there were enough opportunities to demonstrate future value using the technology - both equipment and devices - then available. They always said how valuable their spectrum will be as data demand explodes only to suddenly indicate no one's interested and Sprint is our best bet. Did they really try? I'm sure all of them will get good jobs. Didn't the Sprint CEO who masterminded the Nextel merger get another CEO job? Anything is possible.

 

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