Alexei Oreskovic
Intel was actively involved behind the scenes in brokering the July deal between Sprint and Clearwire(CLWR Quote - Cramer on CLWR - Stock Picks), in which the two companies agreed to share their radio spectrum in order to create a larger WiMax coverage area in the U.S.
And while there are numerous WiMax trials currently underway around the world, the North American market appears to play an important role in Intel's near-term WiMax ambitions. In his keynote address at the Intel Developer Forum last month, Intel CEO Paul Otellini said that the 150 million people projected to be covered by WiMax in 2008 will principally be in North America. If Sprint were to pull the plug on the project, it would be a disaster for WiMax, says Craig Mathias, a principal with Farpoint Group, an advisory firm that specializes in wireless technology. But Mathias doesn't believe Sprint would do something that drastic. "There's value there, and they're planning on going live in two cities by the end of the year," he says. A more likely scenario, says Mathias, would be for Sprint to spin off the WiMax unit into a separate entity. And that's where things could get interesting. Intel's venture capital arm has demonstrated a strong commitment to funding companies involved in building the WiMax infrastructure. Last year, Intel Capital invested $600 million to take a 20% stake in WiMax service provider Clearwire -- the largest investment in the history of Intel Capital. The chipmaker has also made direct investments in a handful of other WiMax carriers around the world in recent years including Japan's KDDI and Australia's Unwired Australia.
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