Won't the losers also be the wireless companies as a nationwide Wi-Max network should enable multi-mode cellphone or PDA-type devices to cannibalize regular wireless services. Can you say Skype over WiMax on your PPC or cell phone.

excellent point.

Clearwire and Sprint have been involved in some spectrum swaps to consolidate their coverage areas -- I see this (together with the Intel investment and NextNet going to Moto) as a positive for Clearwire, because Clearwire's network will move towards 802.16e standard (Moto and Intel's clear objective) and Clearwire and Sprint will establish a roaming agreement, increasing Clearwire's coverage area.

Mark,

Just a couple of comments ...

First, I believe that Clearwire would welcome this announcement. One of the biggest risks of building a business on a new networking standard, is the lack of user devices and compelling applications. CDMA and UMTS experienced slow early deployments, in part, because there weren't a sufficient variety and volume (necessary to drive prices down) of devices. Ultimately, no one company will monopolize a new access technology - especially WiMax, so having a fellow trailblazer to share in some of the early risk, and to help build the market would, I think, be appreciated by Clearwire

Secondly, I really don't see the makings of telecom boom on a scale that even remotely resembles the boom of the late '90s. That boom was driven by changing regulation in the US, followed by ridiculously cheap capital, and the growth of a huge number of new service providers. This in turn lead to massive procurement contracts funded by vendors that were falling all over themselves to get a bigger piece of the pie. Under these conditions, vendor revenues exploded. Nothing like that is happening today. Heck, on the infrastructure front, there is hardly any money being spent on purchasing WiMax. In fact it is not clear from the Sprint announcement how much of the investment will be on infrastructure. Consider the infrastructure extension contracts that are regularly announced in the US and that are almost always in the order of $1b, and frequently more.

Also consider that annual sales of wireless access equipment is in the tens of billions of dollars. Investment in GSM and CDMA is expected to drop significantly over the next few years, and the growth in UMTS sales is expected to plateau. Should the WiMAX market, or something similar, not grow pretty significantly in the next few years we could find the general wireless market to be shrinking, and not booming at all.

I agree, this is terrific news for Clearwire. The reason why McCaw sold NextNext to Motorola is because he wanted to see the technology more widely deployed. His biggest concern is making sure the technology he bet on will become the WiMax standard and this Sprint deal establishes momentum in that regard. Clearwire, in many ways, was merely a way to create a market for NextNet's technology -- no different that RIM creating BlackBerry devices to prove the superiority of its software and to spark a licensing program that would spur the creation of new devices that competed against the BlackBerry. Sprint validates Clearwire...

Similarly, it validates the Bell/Rogers WiMax network that has been established in Canada. Perhaps by Sprint entering the market it will encourage Bell/Rogers to more aggressively expand the network and come out with new hardware -- i.e. WiMax PC cards rather than the awkward modem and cable you currently need. It also encourages Intel to embed WiMax in a new generation of laptops, just as we have with Wi-Fi today (including dual mode WiMax/WiFi laptops).

Then there's Bell's investment in Clearwire. Bell's stake in Clearwire is surely worth more today than when it was purchased. And given that Bell has an early lead in developing VoIP service for Clearwire's WiMax network, it could leverage this experience by selling the platform to Sprint -- assuming Sprint wants it.