Not happy about paying the extra $10 for 4G service? Well, that may not last forever, or be available for the Epic long term. Read more and you decide.
Clearwire Corp. may have to retreat from selling wireless service under its own brand if it wants to receive more funding from Sprint Nextel Corp., the third-largest U.S. wireless operator that owns 54 percent of Clearwire.
Sprint, which has helped finance the company in the past, hasn’t provided additional capital since Clearwire said last month it would run out of cash next year if it couldn’t raise more funds. Sprint said this week it has no plans to acquire Clearwire and is undecided about buying any of the company’s high-yield bond offering.
Sprint resells Clearwire’s wireless service under its brand and may want the company to stop offering a similar service with its Clear label, said Sid Parakh, an analyst at McAdams Wright Ragen. The carrier will likely withhold additional funds until Clearwire agrees to pull back, he said.
“Sprint was saying, ‘Why am I funding a competitor?’,” said Parakh, based in Seattle. Unless the differences are resolved, “it’s hard to see a lot more money coming in.”
Parakh, who owns Sprint shares and doesn’t cover the company, said he’s speculating about Sprint’s motives and hasn’t heard directly. He advises investors to hold shares of Clearwire and doesn’t own any.
The conflict may point to a broader battle for power over Clearwire, which is building a so-called fourth-generation wireless network, said Steve Clement, an analyst at Pacific Crest Securities Inc.
“What’s at issue is that Sprint’s putting money into a venture in which they don’t have control, and I think they’re looking for ways to have more control,” said Portland, Oregon- based Clement, who doesn’t own shares in either company and rates them both “sector perform.”
Cristi Allen, a Sprint spokeswoman, declined to comment beyond the company’s Dec. 13 statement on Clearwire’s debt offering and acquisition. Mike DiGioia, a spokesman for Clearwire, declined to comment on speculation that Sprint wants the company to scale back its retail effort.
“Clearwire maintains a close relationship with Sprint and our other strategic investors,” said DiGioia in an e-mailed statement. “The recent funding announcement demonstrates our strength as an independent company and the opportunity afforded us by the current market conditions.”
Clearwire rose 1 cent to $5.35 at 4 p.m. New York time in Nasdaq Stock Market trading. The stock has declined 21 percent this year. Sprint fell 6 cents to $4.17 in New York Stock Exchange composite trading and is up 14 percent this year.
Money and Power
Clearwire’s long-term borrowing has doubled in the last year while its peers have cut this debt, according to Bloomberg data. The Kirkland, Washington-based company’s long-term debt rose to $2.8 billion as of Sept. 30, as the average for 12 peers in the telecommunications service industry fell to $1.44 billion over the last four quarters, from $1.45 billion.
Clearwire reported cash and short-term investments of $1.38 billion as of Sept. 30, down from $3.8 billion at the end of 2009. The company said last month it would run out of cash by the middle of next year if it couldn’t raise additional funds.
Clearwire is reducing sales and marketing spending, laying off employees and delaying its Clear-branded smartphone as part of a plan to save $100 million to $200 million this year, according to a statement last month. The company is also raising $1.33 billion through its high-yield bond offering.
That won’t alleviate all of Clearwire’s funding needs, said Clement, who estimates that the company needs between $2 billion and $2.5 billion to continue to operate.
Sprint’s Own 4G?
Sprint has $4.67 billion in cash on its balance sheet and easier access to capital than Clearwire, leading analysts such as Clement to expect Sprint to help with its partner’s cash crunch. Sprint has tied itself to Clearwire at least for the next few years as larger rivals, such as Verizon Wireless, have readied their own 4G networks, the analyst said.
Sprint, based in Overland Park, Kansas, could potentially roll out its own 4G service, which provides wireless Internet speeds about four-to-five times faster than older, 3G networks, he said. That may take until 2014 to complete.
“That’s the 4G horse they have to ride,” said Clement.
Clearwire was financed as a 4G company using WiMax technology in 2008 with a $3.2 billion investment from a group of companies including Sprint, Google Inc., Time Warner Cable Inc., Comcast Corp., Intel Corp. and Bright House Networks LLC. Several of those investors also contributed to a $1.56 billion funding round last year, when Clearwire was short on cash.
These shareholders and Clearwire’s management may not want to see Sprint, which already has the authority to appoint seven of 13 board members, gain more control, said Jamie Townsend, managing partner of Town Hall Research in Oyster Bay, New York.
“Sprint has a very large vested interest in seeing Clearwire succeed,” said Townsend, who doesn’t own shares of either company and advises investors to avoid both stocks. “They’ve been caught a little bit between a rock and a hard place in terms of resolving their own issues with Clearwire while getting them what they need.”
All I know is that when I bought this phone just before Halloween for almost $400 fucking dollars I was told by the rep that this phone would do everything that my Blackberry Curve couldnt...namely the flash player, so I could watch videos, etc...
I am sick and tired of seeing the Goddamn Flashplayer 9 logo on every site I try to watch video on, and cant !!!
My friend has the new Motorola droid from Verizon....he can watch crystal clear videos at great speeds (anyone else have super lag times on Youtube videos ??), and has no froyo, Samsung, or Sprint issues !!
I am $400 in the whole for a shit phone from a shit company and I am cancelling my service....I've waited too long for the clowns at Sprint to do the right thing
I will pay the extra money at Verizon for better service
I know what you mean winman. We're all anxious to use all the features there are. I asked people from Spring they say the update will be coming in January. I guess we can wait another month to see what happens.
Well, we don't have any choice but to wait for the official version. Hopefully it's coming sooner rather than later. From what I've read, Samsung and Sprint have missed a number of planned release dates of Froyo for the Epic. Wasn't it originally supposed to come in September/October, ~1 month after the phone came out, then sometime in November, then by the end of the year, and now who knows when? That's really disappointing, especially since there doesn't seem to be a whole lot of information about why they missed their projected release dates. The Epic is my first Android phone, and I have to say that this isn't the greatest first experience with it. I love the phone, but the OS update process seems to have problems.
I was told by Sprint support on November 8th that Froyo would be pushed out to our phones before Thanksgiving. On December 1st, they said by December 25th (Christmas) at the latest. Now they're telling you we'll have Froyo 2.2 in January??? It's amazing how insulting this company can be to their most educated and well-healed segment of customers, isn't it. At least they didn't follow AT&T's bone-headed move of eliminating the unlimited plans. I'll give Sprint credit for having more common sense than AT&T in that area at least.
I was told on the phone today from sales no offician release date for Froyo, but they hope to launch prior to April 12th 2011 when they will release the epic updated hardware (samsung phone) to replace the Epic as a flagship phone.
Looks like Epic may get thrown to the wayside such as the Moment. Froyo may happen but I guarantee it will be End of Life for OS updates for that phone. One thing you guys have to understand is that this is not a Sprint issue. This is directly due to Samsung. They are clearly pushing their Galaxy brand as the flagship phone of their company and will leave the Epic to die. Also, Sprint is not responsible for YouTube's lag. The developers of the YouTube app are. As far as flash goes see if Dolphin HD browser works for you, I'm not sure. I know it supports flash but .....
Lastly for all you guys upset about this, there are plenty of root+roms & kernels that will get you the desired 2.2. Most of these will be leaps and bounds better than the standard Sprint/Android platform.
I used to love Samsung but after purchasing two or three of their phones with no support months after I made the Switch to HTC. Now on my 4th different (Diamond, Desire, Hero, EVO) HTC phone and I will never turn back. Especially considering the EVO will continue to be HTC's flagship phone for a while and will see GingerBread and possibly Honeycomb. I'm sure I'll be on a new phone by the time the Honeycomb/Ice Cream era comes.
Seriously, check out the phones available by this company: http://www.htc.com/us/
Message was edited by: NWEEMS2
Message was edited by: NWEEMS2
Looks like Epic may get thrown to the wayside such as the Moment. Froyo may happen but I guarantee it will be End of Life for OS updates for that phone. One thing you guys have to understand is that this is not a Sprint issue. This is directly due to Samsung. They are clearly pushing their Galaxy brand as the flagship phone of their company and will leave the Epic to die. Also, Sprint is not responsible for YouTube's lag. The developers of the YouTube app are. As far as flash goes see if Dolphin HD browser works for you, I'm not sure. I know it supports flash but ....
You do realize that the Epic is a GalaxyS phone right?
Message was edited by: tarfu2
If sprint doesnt want anyone downloading the copies that are floating around, then why the hell is it taking so long to get it from them?? Here the Evo Shift is out with 2.2....What is the problem here Sprint???? Dont you think you have upset enough of your customers by now?? You cant even supply a date?? Come on, get real!
Data Shows Which Manufacturers and Carriers Delay Android Updates
...I guess we would all have been better off getting the Droid Incredible to benefit HTC &Verizon's superior track record of updating their devices. I'm ready for my Epic upgrade, now.
Samsung officially released the Galaxy S froyo today to all the US carriers, except for sprint.
Update can be applies through KIES (Since the sprint epic does not allow users to connect through KIES, we are screwed)