Sprint Nextel is nearing a deal to extend its current network-sharing agreement with Clearwire to three to five years, Bloomberg reported today.
The deal would allow Sprint to tap into Clearwire's network and wireless capacity to power its own services. For Clearwire, it provides a measure of confidence in the company's long-term prospects. Sprint, meanwhile, secures another resource as it pursues its own 4G course.
Sprintfor Clearwire's planned upgrade to 4G LTE. Sprint CEO Dan Hesse said the agreement serves as a foundation for a new commercial agreement.
Yesterday's disclosure alleviated concerns that Sprint was considering abandoning Clearwire, an impression formed earlier this month during Sprint's investor day presentation. At that event, Sprint executives hardly mentioned Clearwire and focused on upstart partner LightSquared as an ally.
Sprint currently uses Clearwire's WiMax network to power its 4G services, which devices such as the HTC Evo 3D and Samsung Epic depend upon. The company has said it plans to support WiMax at least through 2012.
The deal apparently won't involve Sprint providing Clearwire additional financing. Clearwire has said it needs up to $300 million to fund its operations and another $600 million to upgrade to LTE. The company is looking at selling assets such as unused spectrum or tap the equity or debt market, and CEO Eric Prusch.