As the Wall Street Journal reports, Sprint is to announce as early as next week that it will have a third supplier for its country-wide WiMAX network, namely Nokia. Nokia has not been on the WiMAX technology radar screen so far and might have worked behind closed doors to catch up with others. Nevertheless, they seem to have convinced Sprint to work with them in addition to Motorola and Samsung. As a reminder: total investment will be 3bln USD and more than 100 million subscribers will be reached in the US. Once built up it will be the world's largest WiMAX network, and it will be interesting to see how its real usable end-user data speed then compares with 3G networks. If indeed mobile high-speed data transfer is possible, this could mean a huge competitive advantage over other mobile operators, forcing them to admit that not all technology investments of the past were worth the billions of US dollars spent.
See the full WSJ article below.
Sprint Nextel Corp. is close to choosing Nokia Corp. as its third primary network-equipment provider for its next-generation wireless network throughout the U.S., according to people familiar with the matter.
Sprint, which this past summer selected Motorola Inc. and Samsung Electronics Co. as the other providers, plans to spend about $3 billion on the network using WiMax technology in the next two years. Nokia can expect to get a portion of that as well as additional handset orders from Sprint, which is planning to deploy a network that reaches as many as 100 million people by 2008.
WiMax technology transmits data at speeds similar to those of wired broadband networks and is designed to work with cellphones and computers. Its range is much greater than the Wi-Fi networks that can be found in cafes and airports. WiMax networks could serve entire cities, proponents say.
But WiMax technology is untested on a large scale. In South Korea earlier this year, Samsung built a wireless network with a technology similar to WiMax, but it has yet to be tested with a large user base.
Sprint, which aims to launch service in trial markets by the end of next year, is planning what would be the largest WiMax network in the world. As a result, its business has been coveted by telecom-gear manufacturers, which see the fourth-generation wireless technology as an important growth area. Others competing to be Sprint's third supplier included Alcatel-Lucent of Paris, Canada's Nortel Networks Corp., and Chinese companies ZTE Corp. and Huawei Technologies Co.
Sprint could announce its choice of Nokia as early as next week, people familiar with the matter say. But the deal isn't final and could still fall apart. Also, some analysts have questioned the financial feasibility of Sprint's plans, noting the carrier is
struggling to maintain its existing two networks.
By choosing Nokia, Sprint will have as its WiMax partners the three largest handset manufacturers world-wide. This move is expected to help Sprint control the costs of the new handsets, which typically are a barrier to consumers adopting new technologies. Sprint's decision is expected to help Nokia's handset business compete in the U.S., where it has been lagging behind its leading competitor, Motorola, since 2004.
A Sprint WiMax deal also would be a big win for Nokia's equipment business unit, which earlier this year announced plans with Siemens AG to form a joint venture that would be the third-largest network-equipment company in the world.
Joining with Sprint will likely require some
investment on Nokia's part. When Sprint announced its choices of Motorola and Samsung, it said it had created a "unique business model" that included "commitments" from its partners "in the areas of market development, mobile WiMax devices and other contributions to Sprint Nextel's core business."
