Clearwire Takes Sprint’s Money while Wooing Dish Network

by Matt Klassen on February 28, 2013

For several years Clearwire and its disastrous 4G WiMax technology have been hanging around Sprint’s neck like a millstone, slowly dragging America’s third largest wireless carrier into the deep. In an effort to finally put an end to the Clearwire saga, Sprint announced its intention to purchase the company late last year, looking to harvest its boon companion for only thing it had left to offer: spectrum.

But in a strange twist Clearwire’s minority shareholders weren’t satisfied with the proposed buyout, leading to the entrance of Dish Network into this burgeoning love triangle. As part of the process, Clearwire promised it would not seek any financial assistance from Sprint while in talks with Dish, but since when were relationships ever that neat?

While leaning on one’s former suitor whilst wooing another is never a good way to build relationships, like many before it, it looks like Clearwire thinks it can buck the odds. The company announced yesterday that has accepted an $80 million loan from long-time compatriot Sprint, a relatively innocuous piece of news accept for the fact that despite its previous assertion to the contrary, Clearwire will continue buyout talks with rival bidder Dish Network.

As part of the agreement Sprint proposed in December, the wireless carrier offered Clearwire $800 million in financing available at $80 million over 10 months. Clearwire had refused the first two assistance payments in January and February as it mulled over’s the offer from Dish, but decided to take the cheque come March, saying nothing about whether it would take future payments as well.

Truth be told, this story has all the makings of some cheesy tween romance novel, with the damsel in distress (played by Clearwire) torn between her long-time lover (Sprint) and the sexy new-comer on the block (Dish). Will time tested love win out, or will the passion of a new relationship takeover?

But neither wanting to be the jilted lover, don’t expect Sprint or Dish Network to sit idly by and let Clearwire make the choice. As part of its initial bid, Dish Network had placed restrictions on Clearwire’s dealings with Sprint, meaning that by accepting the latter’s financial assistance Clearwire may have, despite it comments, already made its choice by breaking the rules Dish put forward.

While many seek an explanation of Clearwire’s erratic behaviour, none is forthcoming, as the company has refused to comment on how it intends to move forward with a prospective agreement with Dish when the company has already broken the preliminary injunction against taking money from Sprint. Further, as mentioned, Clearwire has said nothing about its future intent to take more money from Sprint. Nothing like a noncommittal central character to keep the pages turning I suppose.

Clearwire did say, however, that a special board committee “will pursue the course of action that it believes is in the best interests of Clearwire’s non-Sprint Class A stockholders.”

In the end I have to wonder why either Sprint or Dish would waste any of their time putting up with Clearwire’s noncommittal nonsense, except to say that companies, like people, are willing to do almost anything for the fleeting promise of some satisfaction, the goal in this case being one of the most prized wireless possessions of all: spectrum.

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Written by: Matt Klassen. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

{ 3 trackbacks }

Verizon Attempts Clearwire Spectrum Coup — TheTelecomBlog.com
April 17, 2013 at 5:35 am
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May 23, 2013 at 5:56 am
Sprint sues Dish Network over Clearwire Bid — TheTelecomBlog.com
June 19, 2013 at 5:44 am

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