Clearwire Secures $900m In Financing Round Led By Intel Capital

July 06, 2006

Clearwire Corporation, a high-speed wireless broadband services provider founded by Craig McCaw, today announced a series of transactions with Intel Capital, the venture capital investment arm of Intel Corporation, Motorola and Motorola Ventures. Clearwire, which to date has only installed proprietary fixed wireless networks from subsidiary NextNet Wireless, stated it will work closely with those two companies to popularize and accelerate the development and deployment of portable and mobile WiMAX networks based on the IEEE 802.16e-2005 standard.

The transactions include Intel Capital’s investment of $600 million as part of a $900 million private financing round and Motorola’s acquisition of Clearwire’s subsidiary NextNet Wireless, a leading provider of OFDM-based non-line-of-sight wireless broadband infrastructure equipment. This represents the single largest investment for Intel Capital ever. Motorola will buy NextNet Wireless from Clearwire, while Motorola Ventures is also buying a stake in Clearwire.

Additionally, the three companies will cooperate on research, development and deployment of future wireless broadband networks. Motorola will sell NextNet equipment to Clearwire, and Intel will concentrate on getting mobile WiMax chips designed into future notebook PCs. This announcement is significant, as it shows that three major players are intensely focused on getting the mobile WiMAX standard - IEEE 802.16e-2005 -deployed around the world

"The size of this investment from Intel Capital underscores our commitment to supporting wireless broadband using WiMAX networks in the United States,” said Intel Capital President Arvind Sodhani. “Our collaboration with Clearwire and Motorola builds on the foundation of previous WiMAX network deployment investments...”

"Wi-Fi has become an essential part of people's lives. WiMAX is next. It is rapidly moving from a technology initiative to real deployments,” said Sean Maloney Intel executive vice president and general manager, Mobility Group. "...This investment in Clearwire will lay the foundation for high-speed mobile broadband services across North America.”

"Deploying a nationwide network takes a lot of capital," said Sriram Viswanathan, vice president of Intel Capital. Viswanathan said the funds also will be used for customer acquisition and acquiring spectrum.

Clearwire currently offers fixed broadband wireless service based on a pre-standard version of IEEE 802.16-2004, with download speeds of up to 1.5Mbps and upload speeds of up to 256Kbps. The service ranges in price from $30 to $37 a month.

[Contributing writer Alan Weissberger]