Sprint executives leave Clearwire board: I missed this story of a week ago until sensationalist headlines started to appear reading more into the tea leaves than the murky water at the bottom of the cup. Sprint is the majority owner of Clearwire. That remains the same. Sprint has the power to appoint seven of the 13 board positions. That remains the same. Four of the seven board members appointed by Sprint remain in place, and Sprint will nominate three replacements for its executives.
The issue appears to be concern over whether Clearwire and Sprint's business objectives diverge sufficiently that Sprint executives or employees would make decisions that could be construed as anticompetitive or even detrimental to Clearwire shareholders. The SEC, Congress, and other forces have been pushing since the Bush administration to require boards made up of independent directors who have little stake in the current management of a firm.
The issue of whether this signals a partnership with T-Mobile or dropping WiMax seems secondary to the larger antitrust problem. And, if the company were considering partnering with firms other than Sprint for ventures, Sprint employees would be required to recuse themselves constantly, which is awkward for governance. Google CEO Eric Schmidt left the Apple board in part because of the growing competition between Apple and Google, and how often he had to leave the room while business was discussed.
Whether WiMax continues to be Clearwire's 4G flavor of choice won't be directly decided by this move. Sprint and Clearwire still need to prove billions of dollars invested to buy spectrum and build out a network weren't for naught. The widespread affordable availability of LTE is still two or more years away. Verizon might be launching dozens of LTE markets this year, but the gear will be 1.0, power hungry, immature, and in limited varieties. Clearwire can't afford to wait on LTE, and will still be deploying WiMax even if it makes a technology decision to switch to LTE in the future.
InfoWorld's Galen Gruman makes a number of conclusions in his WiMax Is Now Likely to Die article that I disagree with. Sprint execs leaving the Clearwire board won't affect ownership of Clearwire by Sprint, nor the inter-tie contracts in place between the two for network use and roaming. However, the likelihood of all US carriers and most worldwide carriers converging on LTE seems ever more likely.
Well Said! There seems to be so much anti wimax sentiment in so many articles that one can only presume that there must be a little paranoia in the LTE camp. One can imagine that if wimax was a no goer that the LTE camp would not really care and let it die its own death. Who are you trying to convince fella's?