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Sprint and Clearwire Nix WiMax Plan

Sprint Nextel and Clearwire on Friday said they have mutually agreed to terminate their plan to jointly build-out a nationwide, high-speed wireless WiMax network.

The two companies, according to a Sprint statement, “could not resolve complexities associated with the [letter of intent] and failed to reach final agreement on the terms of the transaction.” The duo in July announced that they were negotiating a 20-year agreement to develop a WiMax network that would eventually serve 300 million people. 

Clearwire said the proposed joint venture with Sprint “was likely to introduce a level of additional complexity to each party’s business that would be inconsistent with each company’s focus on simplicity and the customer experience.”

Sprint said it remains committed to developing and deploying WiMax services. It has trials set for Chicago and Baltimore/Washington, D.C., markets by the end of this year, with commercial launch in 2008 under the Xohm brand.

In addition, Sprint expects to continue to with Clearwire on future opportunities on WiMax “through ongoing discussions that include the possibility of roaming, frequency interference coordination, spectrum exchanges, technology evolution and development and network standards.”

However, now that a joint venture with Clearwire is off the table, Sprint said it is reviewing its WiMax business plans and outlook and expects to provide updated guidance early next year. In August Sprint had said it expected to generate between $2 billion and $2.5 billion in revenue from selling WiMax broadband services in fiscal year 2010, while investing $2.5 billion in capital on WiMax through the end of 2008.

Sprint's device and chip partners for WiMax include Intel, Motorola, Nokia and Samsung. The carrier also picked Google to provide a new mobile portal to future WiMax mobile Internet customers.