I’m in New Orleans at The Cable Show, where the Clearwire-Sprint (NYSE: S) WiMax JV owns some of the biggest buzz. Comcast (NSDQ: CMCSA) CEO Brian Roberts and Intel (NSDQ: INTC) CEO Paul Otellini, whose companies are both investors, talked up the new JV during the opening session. Later, when asked why he believes Clearwire (NSDQ: CLWR) will succeed where Sprint-cable partnership Pivot failed, he bluntly spoke about the differences between the two.
Excerpts from the session after the jump…
Roberts on Pivot: The difference is Pivot, with all due respect, was a me-too product. It was a marketing relationship between the cable companies and Sprint. There was no money changing hands so we could argue how much did everybody really have skin in the game to make it successful. Frankly, it’s been well documented that Sprint had some issues in the past year, the change of leadership and the issues we all know about.
“It was a desire that if we needed a quadruple-play product, if we needed a cellphone, Sprint would say, ‘you can have my Sprint phone, you can call it something different, but it’s my package, my minutes, my billing, my customer’ — ‘my’ being Sprint — but you can call it quadruple play. We’ve not needed a quadruple play so we don’t feel we were harmed by not it not being successful.
We learned some things. This is an entirely different proposition. This is building a new network, having a bridge to getting that new network up and running, which is the Sprint network backing it up while it’s getting built. It’s not a me-too network; it’s really a quantum leap in what wireless can become. It’s not a five-or-ten year deal: it’s forever. It’s a founder’s relationship that is permanent and it’s wholesale, meaning it’s our customer, our billing, our marketing, our package and we design the product. I think they’re quite different. I can understand the question; it’s a very fair question.”
Roberts on Clearwire: “This is definitely our preferred choice. Out of all the different things we learned from in the past, this feels really right. What this is … you’ve got a number of companies who want to see the fastest data network that’s ever been built get built — and get it built right way.” He compared to the change from dial-up to broadband. Among the major draws to doing it as a JV:
– it’s wholesale. “We’ve never had that before with relationships. We either had to build our own or sell somebody else’s product.”
– compared to the way operator-by-operator build-out of broadband: “The big problem with starting from scratch … you’re not national from day one. … We’re national from day one with no holes in the coverage area.” Sprint has committed all of its 2G and 3G network for the benefit of all the partners.”
Otellini on Clearwire: “This country will finally move from a third-world position in wireless communications to lead the world.”