US mobile operator Sprint Nextel’s is considering whether to let rival T-Mobile invest in its majority-owned wireless network provider Clearwire, claims the Wall Street Journal. According to the newspaper, Sprint’s board of directors is discussing this…
US mobile operator Sprint Nextel’s is considering whether to let rival T-Mobile invest in its majority-owned wireless network provider Clearwire, claims the Wall Street Journal.
According to the newspaper, Sprint’s board of directors is discussing this at the moment.
Last month, Clearwire reported losses of US$125.9m, deeper than the previous year’s losses of US$73.4m, an increasing drain on Sprint.
Clearwire has championed WiMax, but dramatically announced last month that it would be testing rival technology LTE, which is more in line with the opinions of the other major telcos in the US.
Clearwire’s poor performance has concerned Sprint, especially as at the end of the year the company is expecting another US$1bn of funding on top of a US$1.2bn investment in 2009. Analysts claim Clearwire will need at least US$4.5bn more in financing before it begins generating its profit in 2014.
One option that has been discussed in the media is for Sprint to buy out the remaining 49% of the equity held by Comcast, Time Warner, Intel, Google, Bright House Networks and the firm’s original shareholders.
However, expanding the company’s investor base is another option and given that T-Mobile USA told analysts in March it is looking at JV opportunities for additional spectrum, it might be a sensible move for Sprint.
A spokesperson from Sprint Nextel declined to comment on the speculation.
T-Mobile USA was not available by press time.
