Like the offspring of a swan that's been dosed with radiation, WiMAX is back and it's bigger than ever. After Sprint Nextel
The new consortium has various players contributing either assets or cash. As many have speculated, Sprint Nextel needed to offload the burden of its WiMAX division to focus on its flailing core business. With the lucrative spectrum assets that the company is contributing to the new venture -- called Clearwire -- Sprint Nextel will get a 51% stake.
Another 22% goes to Intel
The partnership is a very complex arrangement that still has to cross many hurdles. While it will take the rest of this year to close, if successful it will give the WiMAX platform a significant boost in the U.S. market.
Whenever discussing the wireless market at conferences or meetings, I'm hit with questions along the lines of "Do you think WiMAX will succeed?" Over the years of ups and downs in its rocky birth, I've always answered "Absolutely. Too many big backers refuse to let WiMAX fail."
The reason why WiMAX won't die is because it is not just a technology -- it's an ecosystem that allows today's computing and multiservice titans an avenue into the lucrative telecom market. WiMAX is all about wresting power away from the AT&Ts
The partnership is promising that consumers will see WiMAX-based services on a wide scale in the next few years. While that may be true, it's far too early to even speculate whether these companies will earn a good return on their investment.
The Motley Fool Inside Value service looks for value in beaten-down shares of companies like Sprint Nextel. To see what other companies the analyst team recommends as being priced below intrinsic value, take a free 30-day trial.
Fool contributor Dave Mock is changing his name to DaveMax. Soooo cool. He owns shares of Intel and is the author of The Qualcomm Equation. Intel and Sprint Nextel are Inside Value recommendations. The Fool's disclosure policy is all about putting power in balance.