Google, Clearwire, and Subscriber Growth

November 12th, 2009 by · 5 Comments

As soon as WiMAX upstart clwr announced its new funding package this week, you could hear the mumbling.  Google didn’t pitch in!  Google must not believe in the company any more.  Now, I can’t speak for Google directly, but the market consistently misunderstands the companies intentions.  Google didn’t invest in Clearwire in order to take over telecom, or even to make a start at it.  They did it because it’s worth far more to them to have another last mile alternative in the system than it costs them to help get one started.  If they’re not needed to keep it going, then they will leave it alone.  I doubt Google will invest more unless there is a real danger they won’t get their last mile alternative out of it.

As usual, little else about Clearwire’s financial results mattered except their capital expenditures, current cash balance, and plans for new capital.  Overall, the market was not terribly pleased with the report, but honestly that’s par for the course – it always takes longer than people hope it will.  Clearwire clearly has the money to keep building out for some time.  The key now is subscriber growth, and we at least began to see it this quarter with net additions of 44,000.  More importantly, the company sees that rate accelerating, and net additions in the fourth quarter will likely be more than in the past three quarters combined.  But of course, these numbers are still small and they will need to maintain that acceleration for quite a while in order to achieve scale.

Is anybody out there using Clearwire’s WiMAX?  How does it measure up so far?

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Categories: Financials · Wireless

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5 Comments So Far

  • Ash says:

    Clearwire works great! I have been using them pre-wimax and now with there 4G network. I have never had a problem with their service. In the next couple of years people will not be able to be without there wimax enabled devices. Buy the stock now before it is $35’s a share.

  • VPG says:

    Clearwire’s spectrum does not work properly outside of major metros. The Company will be bankrupt in 3-4 years. The stock is a total dog, any engineer will tell you this is a money pit. Do your own homework don’t follow the herd with Intel Motorola Comcast etc. Google was smart to not fund them.

    • Jo Jo says:

      I don’t know where you got your information from. You can’t look at wimax today and say it will never succeed. You need to look 3 to 4 years from now and think how will we survive without wimax enabled devices. Clearwire sees the future. Yeah it is bleak now but it is only getting started. Google would have given more money if it felt Clearwire was on the brink of failure, but have realized that they are more then capable of finding other organizations to support them during this build out phase. Google does not want to own a network it wants to generate revenue from people using the network through their android software.

  • Clevus says:

    Well this is nice, we now have a good mixture of sentiments

  • Anonymous says:

    The whole wimax versus LTE dispute is getting a bit old… Both technologies will be successful. It’s no different than the multiple cell platforms we have today… cdma, tdma, gsm, iden. Consumers don’t give a rats ass about the technology, they just want it to work (which both do well).

    The real question is the spectrum depth which each carrier owns which will set them apart.

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