Q&A: Clearwire’s Ben Wolff Talks WiMAX

In preparation for the July cover story on 4G services in the United States, xchange magazine spoke with Ben Wolff CEO of the new Clearwire Corp., which is the result of Sprint-Nextel Corp.spinning off its Xohm mobile WiMAX division to the old Clearwire, which has been investing in WiMAX in various markets across the country and holds the largest amount of 2.5GHz spectrum after Sprint’s share. xchange’s senior editor, Tara Seals, spoke to Wolff about how he thinks WiMAX will transform the communications landscape.

And click here for a Q&A with Clearwire President Barry West.

xchange: Why so bullish on WiMAX?

Wolff: There is an awful lot of WiMAX activity worldwide, with 281-plus deployments. There is a perception that it's primarily a U.S. effort, but that's a Eurocentric view and doesn't reflect reality of how widespread it is. WiMAX is significant in India, Russia and a host of Asian countries. The WiMAX train has left the station, and even if the deal hadn't happened, WiMAX would be able to achieve the scale the WiMAX Forum is expecting.

xchange: Why the Sprint deal?

Wolff: WiMAX is well on its way and a significant factor in the 4G technology game, but to build a nationwide WiMAX network, the odds of a single company creating that footprint is much more remote. Neither of us had enough spectrum for that to deploy. The more we worked on a roaming agreement, the more complex it became. From a systems architecture perspective, it’s difficult to find a way to deliver consistent product and services nationwide. So we came to the conclusion that by combining resources and efforts, we’d end up with a more cohesive network across the U.S. than could have been created through roaming partnerships.

xchange: Where are we in terms of the WiMAX device ecosystem?

Wolff: There are more than 100 different devices in various stages of testing and certification, and many will be certified by the end of the year. In terms of commercial availability, vendors are talking about it for ‘08, but ‘09 will see a tremendous expansion.

We’ll start off with laptops and mobile computers, then carry through to handheld devices, ultra mobile PCs, then small form factors like PDAs and handsets. Later in 2009 and 2010, we will see WiMAX-enabled consumer electronics devices not historically connected other than a USB cord.

xchange: What does that mean for the service provider business model?

Wolff: You don't want to be in the position where all you have to sell is commodity service on the basis of price and quality. So our job is to provide enhanced services that people really want. Some customers will just use us for connectivity with no other apps and services. But look at the margins for value-added services like downloads, ringtones and games. We’re in the beginning stages of communication companies understanding that they should be offering products and services beyond just gigs of data and voice.

xchange: What about the business opportunity?

Wolff: When you think about the target market, there’s tremendous productivity gains to be had with WiMAX. It’s the opportunity for enterprises and small business owners to deploy mobile sales forces and drive down the total amount of dollars spent on communications. We're going to see new business models emerge for end users as a result of this kind of capability.

xchange: What do you expect to be challenging as you move forward?

Wolff: The task of building out a new nationwide network is nothing to sneeze at. It’s a large undertaking. But you look to lessons learned. In fact, the mid-90s was the last time we had a significant buildout. The lessons that have been learned from that have been very useful. We’re also combining that with lessons learned here at Clearwire from the first 50 markets we rolled out nationwide [with fixed WiMAX].

xchange: What about LTE?

Wolff: We've gotten past the question about whether there will be a need for 4G services. Take a 3G-enabled PDA and try and surf the Web, and it is largely a painful experience.

So you've got AT&T and Verizon talking about LTE, and now you'll have us with WiMAX and the cablecos offering WiMAX. There’s a lot of skepticism as to when LTE will be available; maybe not nationwide until 2015. Our time-to-market advantage certainly is a plus, but this country has seen multiple technologies succeed and thrive for a long time. Just take CDMA and GSM. Having more than one technology is not something uncommon.

Technology is only one part of the equation; WiMAX and LTE share a lot of the same DNA. But it's also about how much spectrum is available to deploy a 4G service. There is a real question of how much spectrum is necessary, but you always need more than you think. Also, LTE will require brand new equipment and an effective rebuilding of the network.

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