Sprint agrees to pay $1 billion for Clearwire’s 4G

Sprint agrees to pay $1 billion for Clearwire’s 4G

US operator, Sprint Nextel has agreed to pay 4G operator Clearwire at least $1 billion during 2011 and 2012 for the use of its next generation network.

This announcement comes as an amendment to the companies’ existing wholesale agreement after disputes over pricing paid to Clearwire for its services.

John Stanton, Clearwire's interim CEO said: “We are pleased to have the resources and partnerships necessary to maintain our 4G leadership and leverage our significant spectrum and capacity for delivering mobile broadband services."

Sprint is a majority shareholder in Clearwire holding a 54% stake in the company and it is believed that this cash injection into its business will help the previously struggling network.

As part of the new agreement both companies are allowed to resell the other’s 3G and 4G networks to other parties. This allows both parties to enter into new areas of business.

The agreement gives Clearwire a minimum usage commitment of $300 million in 2011, £550 million in 2012 and £175 million in pre-payments for 4G wholesale services to be used over the next two years.

Peter Bell, research analyst with Telegeography said: "I think the deal between Sprint and Clearwire is crucial for both companies because 4G mobile data services will be a key driver of future growth. The partnership has so far worked well for both companies, and it will be much easier for them to move ahead together now that their wholesale deal has been finalised." 



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