04:08 AM

Tech Watch: Intel invests in Clearwire

by Doug Millison, SiliconValleyWatcher.com

At least one high-powered Wall Street investment banker - an old buddy of mine who emailed me this morning - has his eye on Clearwire, a new company from cell phone empire-builder Craig McCaw... and so does Intel.

Intel Capital has made an unspecified investment in Clearwire, the company announced today, as part of a broader $150 million strategy in wireless technology.

Clearwire will use Intel chips in the nationwide network it is assembling to provide wireless broadband Internet and telephone service, using the emerging WiMAX technology, based on the IEEE 802.16e standard. WiMax is expected to compete with cable modems and DSL within a few years, and can link existing wireless Wi-Fi to fixed network infrastructure.

"McCaw is a smart guy," says my Wall Street friend, who knows where the skeletons are buried in some of the bond deals that financed the first wave of cellular phone networks in the 1990s, and the more recent wave of investment in wireless spectrum.

Clearwire has acquired dedicated spectrum for the new service from companies that managed to raise capital to bid on frequencies at US government auction, then went bankrupt before being able to roll out service. Another McCaw company, NextNet, is supplying technology to the project. In August, Clearwire launched its first broadband wireless network in Jacksonville, Florida. The network, using NextNet technology, is a precursor to upcoming WiMAX networks.

McCaw built the first nationwide cellular empire, McCaw Cellular, and sold it to AT&T for $11.5 billion in 1994.


Intel, Clearwire to Accelerate Deployment of WiMAX Networks Worldwide, Intel's press release

Intel Capital, information about Intel's investment unit

Clearwire, corporate site

NexNet, corporate site

Craig McCaw's Secret Plan: His deals in wireless broadband have the telecom world buzzing, in Business Week Online, 24 May 2004