Skip to main content

Clearwire: 2 Million Subs By End Of 2010

Clearwire, the wireless broadband company whose backers include Comcast
and Time Warner Cable, expects to triple WiMax subscribers this year to
hit about 2 million.

The company had a total subscriber base of
688,000 as of Dec. 31, 2009. Of those, 46,000 were wholesale subscribers
from Comcast, Time Warner Cable and Sprint, each of which owns an
equity stake in Clearwire.

Clearwire is bullish on racking up more subs through
Sprint and the cable partners in the year ahead. "We are seeing a great
ramp in the wholesale business and we are very optimistic about the
future," Clearwire chief financial officer Erik Prusch said on the
company's earnings call Wednesday. He noted that most of the 46,000
wholesale adds came in the fourth quarter.

In the fourth quarter, Clearwire launched WiMax in 13 markets
including Chicago, Dallas and Philadelphia. In 2010, it expects to build
out its network to cover the top 100 U.S. markets, with a service
footprint of up to 120 million people, with new markets expected to
include New York, Boston, Washington, D.C., Houston, the San Francisco
Bay Area, Denver, Minneapolis and Kansas City.

The next market to launch will be Houston and is scheduled to
go live in the coming weeks, ClearwireCEO Bill Morrow said, also on the call.

"We expect the bulk of our 2010 market launches to take place toward
the end of this year," Morrow said. "While the network build activity is
well underway across dozens of new markets, we are studying our
experience in those already launched and working with existing and
future wholesale partners to optimize our subsequent launches."

Clearwire ended 2009 with slightly under 5,000 towers in service; for
2010 the company expects to build out slightly under 20,000 towers to
provide the coverage in those markets.

Through Clearwire, Comcast offers High-Speed2Go in markets including Philadelphia, Atlanta and Portland, Ore.
TWC has launched Road Runner Mobile in Charlotte, Greensboro and
Raleigh, N.C.; Dallas; San Antonio; and Honolulu and Maui.

Bright House Networks also is an investor in Clearwire but hasn't
commercially launched WiMax service yet.

Clearwire expects retail cost-per-gross add to remain around the 2009
average of $565 because of "a significant number of market launches."
In addition, the company expects retail average-revenue-per-user to
remain flat with 2009, during which ARPU was $39.65.

Clearwire currently expects to have full year 2010 net cash spend
between $2.8 billion and $3.2 billion. Last year the Kirkland,
Wash.-based company raised $4.3 billion in funding, including $1.6billion from strategic investors Sprint, Comcast, TWC, Bright
House, Eagle River and Intel.

Also on the call, Prusch said Clearwire had identified a "material
weakness in controls," and as such wrote off approximately $30 million
in equipment inventory and increased reserves for obsolescence and
shrinkage by $11 million.