Sprint Seeks to Buy Rest of Clearwire for About $2.1 Billion

Sprint Nextel Corp. (S) proposed to acquire shares in wireless partner Clearwire Corp. it doesn’t already own in a deal that the third-largest U.S. carrier says would cost about $2.1 billion.

Sprint, which owns more than 50 percent of Clearwire, is seeking to acquire shares at $2.90 each, or 5.5 percent more than the stock’s closing price in New York yesterday, according to a regulatory filing today. Sprint proposed to provide interim financing of as much as $800 million.

Sprint is getting an influx of cash from Japan’s Softbank Corp. (9984), which agreed to buy 70 percent of Sprint for about $20 billion. Sprint agreed to buy Eagle River Holdings LLC’s 4.5 percent stake in Clearwire in October for $2.97 a share.

Clearwire shares jumped 2.6 percent to $2.75 yesterday in New York. The stock is up 42 percent this year.

Sprint originally formed the Clearwire joint venture in 2008, relying on $3.2 billion in investments from Google Inc. (GOOG), Intel Corp., and cable companies such as Comcast Corp. and Time Warner Cable Inc. The idea was to build a national wireless network that could compete with Verizon Wireless and AT&T Inc. (T)

Clearwire never lived up to those ambitions, and the project has yet to break even. Along the way, partners such as Google and Time Warner Cable have sold their stakes for a fraction of their original value.

Wireless Carriers Fight Over Airwaves

Story first appeared in Bloomberg Businessweek.

The AT&T Inc. Chief Executive Officer said Washington needs to figure out how to clear a regulatory logjam that’s hampering wireless growth and forcing companies to raise prices.

The industry is waiting for the Federal Communications Commission to decide on Verizon Wireless’s proposed $3.6 billion partnership with cable companies, including Comcast Corp. The review of that agreement, announced in December, is holding up related deals for spectrum by AT&T and others.

The popularity of the iPhone and other smartphones is putting pressure on existing networks, prompting wireless carriers to seek more capacity in crowded markets. The FCC has to sign off on each transaction, and its rate of decision making can’t keep pace with the industry’s evolving needs.

The industry is just kind of stuck and sitting there watching Verizon-Comcast to see what happens.

AT&T, based in Dallas, says it faces a shortage of spectrum -- the airwaves that let mobile devices make calls and download data. Ever since its $39 billion takeover of T-Mobile USA Inc. was shot down by regulators in December, it has been warned that the constraints on airwave expansion will cause higher prices. When spectrum is tight, the only recourse carriers have is to charge more, degrade quality or throttle service.

No Delay?

The FCC Chairman fired back at AT&T this week, saying that the failure of the T-Mobile deal didn’t create an industry shortage on its own. There hasn’t been a holdup in the regulatory process.

Hundreds of wireless transactions involving approximately 1,000 spectrum licenses have been approved, some involving licenses valued at billions of dollars.

AT&T won approval from federal regulators for a $1.93 billion purchase of Qualcomm Inc. airwaves in December, three days after dropping its plan to buy T-Mobile USA.

Leap Talks

In February, the Wall Street Journal reported that AT&T was in takeover talks with Leap Wireless International Inc., a pay- as-you-go carrier in San Diego. A Reuters report reiterated yesterday that AT&T had held discussions with Leap in recent months, boosting Leap’s shares 7.8 percent today. In February that there was little chance of AT&T buying Leap.

AT&T shares rose 1.4 percent to $33.59 at the close in New York. The stock has climbed 11 percent this year.

AT&T, the second-largest U.S. wireless-service provider, says that the industry would push ahead with more spectrum purchases if the government weighed in on Verizon’s agreement with cable companies. That deal would let Verizon, the No. 1 U.S. carrier, buy a major swath of unused spectrum from a group led by Comcast.

Companies should be able to buy and sell spectrum more freely, letting them better satisfy regional demand. A carrier in one city may have low market share and more than enough spectrum, while another company has lots of customers and inadequate airwaves to serve them. The government approval process doesn’t let the industry make deals quickly enough to meet customers’ needs, AT&T argues.

Fostering Competition

For its part, the FCC is trying to balance the allocation of spectrum so that customers always have several service providers to choose from. The intent is to keep prices down by ensuring competition.

Distributing spectrum among competitors who can’t use it efficiently doesn’t help. The government either has to let companies pool their spectrum or risk pushing underperforming companies out of business.


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Sony And Comcast To Unleash New Kind Of Retail Experience In Philadelphia

Originally Posted at Cnet

Amid the recession and layoffs, there are some glimpses of employment hope and opportunities to help you make informed decisions on what technology to spend money next.

Sony Electronics and Comcast announced Sunday that they have partnered to open a unique retail experience in Philadelphia. The store is named Sony Style Comcast Labs and will serve as a place where consumers could learn about emerging technologies and experience new digital devices.

The co-branded retail store and technology lab, which opens to the public Monday, March 16, will showcase the latest innovative products and services from both companies and preview future Comcast technology, products, and services.

Examples of future technologies that Comcast unveiled to Philadelphia consumers for the first time include "The Future of High-Speed Internet" and "The Future of Home Phone Service."

The former offers the experience of Internet surfing and downloading at 100Mbps, about 20 times faster than regular existing cable connection. To put this in perspective, at this speed you can use up Comcast's 250GB ration in about 40 hours.

The latter, on the other hand, shows of what you can do with the future enhanced cordless telephones. Obviously, they can do a lot more than just placing calls; they also handle e-mails, IM, text messaging, and access to Yellow Pages.

As for Sony, the new Sony Style Comcast Labs feature the best of Sony's electronics. Sony's current showcase include Bravia HD LCD televisions, Vaio PCs, dSLR and Cyber-shot digital cameras, Handycam camcorders, and PSP and PlayStation 3 game consoles. Emerging technologies such as Organic Light Emitting Diode TVs are also shown.

Comcast will also showcase all of its products and services from voice to video and Internet, and it will demonstrate how they work together seamlessly for the consumer.

The Sony Style Comcast Labs is located at the base of the Comcast Center, just a few blocks away from the Chocolate Works Philadelphia Apartments.