Print 7 comment(s) - last by wimaxed.. on Feb 14 at 10:08 PM

Three major U.S. cites to get Xohm this Spring

Many ardent mobile phone and laptop users are still waiting for high-speed wireless connections to come to their cities. Many are left utilizing mobile data plans that are on par with dial up connections from the early 1990’s rather than being comparable to today’s broadband speeds.

PC World reports that Sprint’s oft-delayed WiMAX service dubbed Xohm has a soft launch coming soon. According to WiMAX Forum president and CEO Ron Resnick, WiMAX products are here and WiMAX is here. That statement will sound hollow to those looking forward to WiMAX in the United States.

While there have been 260 commercial deployments of WiMAX in 110 countries according to Resnick, the service has yet to see wide availability in America, and it could be a while yet before that happens.

Ali Tabassi, Sprint’s VP for technology development, says that a soft launch of the Xohm service will happen this spring in Baltimore, Chicago, and Washington D.C. Tabassi points out, however, that the budget for rolling the service out to the majority of Sprint customers is not yet finalized.

The cost of setting up a national WiMAX network from Sprint is reported to be $5 billion and if Sprint is willing and able to part with that amount of money is a decision Sprint CEO Dan Hesse has yet to make. $5 billion is a huge chunk of change in anyone’s book and more so when Sprint is cutting back on staff to cut costs as it loses customers to rivals.

The promise Sprint’s Xohm service makes is tantalizing with WiMAX Forum members claiming download speeds in the area of three to five megabits per second and upload speeds of one to one and a half megabits per second.

The only thing known now aside from the soft launch in the three major U.S. cities is that Sprint acknowledges it will not hit the 100 million subscriber mark for its Xohm service in 2008 it had aimed for.

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RE: Unusual Usage
By Sahrin on 2/14/2008 4:17:54 PM , Rating: 2
But should Sprint invest all its eggs in WiMax at the expense of their iDEN and CDMA customers? Their existing service network is subpar compared to AT&T and Verizon's offerings, so they've essentially become the low-priced, "dumb pipe" carrier (not a profitable position to be in.) If they were to spend $5 billion on WiMax, I don't see where the money's coming from unless they sell off their other assets. In other words, if Sprint wants to be aggressive on 3.5G/4G, then they need to reinvent themselves as something other than a traditional carrier.

You make a valid point, especially given what little we know about LTE v. WiMax as a 4G solution. However, Sprint is bleeding customers NOW, and it can't wait for the technology to shakeout. The cash is available (go to Sunnyvale and you'll find $1-3B USD from INTC, Cisco, Chipset providers et al) if you are willing to commit to the technology.

If Spring were to go it alone; including charges for the merger with Nextel they earned $1.3B on revenues of $44B in 2006. Understanding that they will be deploying in phases (that is, they will begin realizing investable revenues from the network before they have invested the entire buildout capital), with a down payment from Cash-on-hand of $1.5B, I could see them getting matched by Silicon Valley (INTC and Cisco/Qualcomm most likely) to $1-$1.5, and while there is considerable credit pressure, banks are becoming desperate for debt markets to invest; corporate credit is about the only market that doesn't have massive default problems today.

If Cerebrus and AMD can 100% finance buyouts of dying companies, I think Spring can get $2-3B USD at 5-7% to build a nationwide wireless broadband network.

I am obviously advocating WiMax, primarily because Spring needs to move NOW to protect its market share - waiting will only erode their subscriber base further; it is possible that WiMax as a technology is the problem, and not Sprint's motivation to self-preservation

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