AT&T threatens WiMax joint venture
Company has filed a petition with the FCC to stop Sprint Nextel and Clearwire from combining WiMax assets to build competing nationwide wireless broadband network.
AT&T is looking to put a kibosh on the proposed merger of Sprint Nextel's nationwide WiMax assets with those of Clearwire.
On Thursday, the nation's largest phone company filed a petition with the Federal Communications Commission, asking it to deny approval of the merger.
Sprint Nextelto form a new joint venture that would combine both companies' WiMax assets to create a nationwide broadband wireless network. The deal, which has been valued at about $14.5 billion, is being backed by cable operators Comcast and Time Warner, as well as Intel and Google.
The FCC, which is currently reviewing the merger, must give its blessing for the deal to be completed.
In its filing, AT&T argues that the proposed merger, "openly state[s] that they (Sprint Nextel and Clearwire) intend to compete with other national wireless providers--including AT&T--yet they fail to make the required showings necessary for the commission's review."
It's funny that AT&T is putting up any kind of stink to the merger, considering that the company exists in its current state only because of several massive mergers in the past few years, including the multibillion dollar merger between AT&T and BellSouth, which put full ownership of the wireless operator under one owner, and the purchase of wireless assets from rural operator Dobson Communications last year.
But it's clear that AT&T is nervous about the new Clearwire's plans. AT&T is currently still deploying 3G technology throughout its territory and is. But it is years away from taking the next big leap toward building a 4G network, which will use a competing technology known as Long Term Evolution, or LTE. By contrast, WiMax technology is available and working today. And regardless of the outcome of the merger, Sprint expects to . What's more, devices supporting WiMax have already been developed and will hit the market by year's end.
While analysts still aren't sure whether WiMax will survive in the long run as a mobile technology here in the U.S., it appears from AT&T's latest moves that it's at least a little bit scared that the new Clearwire network, with backing from heavyweights like Intel and Google, could get enough traction to threaten its current and future wireless business.