Crossroads

At the intersection of technology, finance and the Pacific Rim.

Sunday, July 09, 2006

Intel and the Spurring of Innovation--Wimax/Wibro

Intel recently announced that they will be investing $600Mn in Clearwire, a Wireless data company started by Craig McCaw, founder of two blockbuster companies in the US. McCaw previously founded McCaw Cellular and Nextel (which recently merged with Sprint in a $30BN + deal). His latest venture is focused on rolling out Wimax (the latest of wireless broadband technologies which is otherwise known as "WiBro" here) principally in the US, but also in other parts of the world.

$600Mn is a lot of money for a young telecom venture company, even for Intel. Clearly they believe that a spear is needed for building out Wimax. They will be looking to Clearwire as the sharp point that will drive the technology to become a predominant technology standard. And it is strongly in their interest to build out the Wimax platform, much like they built out wireless LAN with their Centrino product. People around here can point to KT as being among the first to roll-out this broadband wireless technology, but frankly they are not in the same league (I know others may disagree). Yes technically they may be there and they have money and are making big investments in the technology, but their deal-making--which after all is what Intel needs for the spread of the technology--is suspect. If KT cannot get out of Korea with the technology, then they are a relatively small piece of what Intel hopes will be a big puzzle.

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