Clearwire signs landmark agreement with Cisco

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Clearwire signs landmark agreement with Cisco

By CAROLINE GABRIEL

Published: 14 May, 2009

READ MORE: Clearwire

Just as WiMAX was in danger of being overshadowed by the looming LTE, it has received the kind of boost it needs - full blooded commitment from the one major equipment vendor with an entirely open IP agenda and no 3GPP axes to grind, Cisco. This comes in the form of a far reaching agreement with Clearwire, covering core equipment supply and the creation of new devices, applications and channels to market.

It is not clear whether the deal involves any financial investment from the larger firm. Adding to recent collaborations in the Clearwire developer 'sandbox' in Silicon Valley - which runs on Cisco's core network and looks to generate innovative new applications for the operator and its partners - Cisco will now become Clearwire's core network provider nationwide, and will create a range of WiMAX devices via its Linksys consumer and small business unit, which will be sold through the Cisco channel, with a particular focus on small to medium enterprises.

Cisco, which has been expanding in the WiMAX market recently, particularly in the core network, has belatedly pressed the 'full speed ahead' button and is now poised to become a major supplier, combining its carrier routers and other core products, its WiMAX RAN (acquired with Navini Networks in 2007) and a range of enterprise and consumer devices that it plans to create in its Linksys subsidiary. Although Cisco will also be keen to support LTE with its core network and probably its devices - or indeed, any technology that drives increased volumes of the IP data on whose explosion Cisco's strategy relies - WiMAX gives it the opportunity to get into the mobile broadband operator market at an early stage to win credibility. Also, WiMAX fits very naturally into Cisco's approach to architectures, and the firm can expect a far greater degree of influence and market weight in a sector whose assumptions and ecosystems come from that of the PC/IP world, in which the router giant holds sway, rather than from the cellular heritage.

Cisco's open support is the breakthrough Clearwire has been looking for as it tries to convince investors that it has sufficient advantages - in terms of spectrum holdings, financial backing, and new approaches to applications and tariffs - to carve out a role in US telecoms even alongside the giants AT&T and Verizon. Cisco can deliver something overnight that many operators take years to build up - a channel to market, complete with powerful brand, that spans the home right up to the enterprise.

Initially at least, the enterprise appears to be the main focus of the new alliance. Cisco said it would develop new Mobile WiMAX devices and offer Clearwire access to its network of channel partners, in order to sell services to small businesses and enterprises. Although the larger firm is tightlipped about details of these devices, it did say that the first batch would launch later this year, and would include routers branded with the 'Cisco by Linksys' badge. These could in time come under Cisco's wireless enterprise management and security platforms for integration with other IP networks.

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