Sprint’s plan to shut down its WiMax network by the end of 2015 which came to light in a new financial filing, is a reminder of the complex network transition the company is undergoing and will continue to undergo.
The carrier has what many consider the strongest spectrum portfolio of the nation’s four major carriers and has ambitious plans for that spectrum – but achieving those plans requires re-purposing substantial portions of the company’s spectrum holdings, including the WiMax network that Sprint has had since it acquired Clearwire.
WiMax is a 4G technology that came to market before LTE, and Clearwire deployed it hoping to gain a first mover advantage. But when every other major U.S. carrier opted to use LTE, the use of WiMax became a liability rather than an advantage.
A Sprint spokesperson said the company continues to sell “a few” WiMax devices but is not advertising or promoting those devices. The company was unable to provide an estimate of how many customers currently have WiMax devices.
The spokesperson shared Sprint’s current terms and conditions, which advise customers with WiMax devices that Sprint reserves the right to migrate the customer’s service to LTE during the agreement term. “Reasonable advance notice of the service change will be provided to impacted customers, who can then select one of the following options,” the agreement says.
Those options include:
- Completing the agreement term by using his or her existing device without WiMax capability (apparently this means the customer would fall back on Sprint’s 3G network)
- Completing the agreement by contacting Sprint after receiving notice of the transition to move to the LTE network with no additional term commitment
- Deactivating service (an option that will not entail an early termination fee
Sprint has leveraged multiple spectrum bands to support the nation’s highest-speed mobile service, which the company offers under the Spark brand — but as of now that service is only available in certain markets. In the mean time, Sprint’s CEO Dan Hesse has said that the need to “rip and replace” the company’s network is driving some customers to churn.
Hesse has likened the process of upgrading Sprint’s network to the brick house built by one of the fabled three little pigs. “It will take longer but when we’re done we will have the best house,” Hesse told investors at a recent financial conference.
Financial analysts at Moffett Nathanson who specialize in telecom said in an October 2013 research note that they think Sprint’s turnaround is going to work. They noted however that the process will take two to three years.