Sprint Nextel unveils more WiMAX plans

Sprint Nextel Corp. has dubbed its planned mobile WiMAX service “Xohm,” and demonstrated use of the technology at an event today in Virginia, detailing some of its plans for WiMAX and reiterating its timeline for the network’s launch.
The carrier said that Xohm (pronounced “zoam”) commercial services are expected to be available in the first half of 2008, following a soft launch of its WiMAX network by the end of this year in the Chicago and Baltimore/Washington D.C. markets. Sprint Nextel has partnered with Clearwire Corp. on network buildout, marketing and other aspects of rolling out WiMAX services, and the two companies plan to cover about 100 million potential customers by the end of 2008, with Sprint Nextel covering about 70 million pops and Clearwire covering about 30 million pops. Sprint Nextel added that it plans to cover about 125 million pops with WiMAX by the end of 2010.
The carrier revealed some financial expectations for WiMAX as of 2010: that new lines of business will generate more than 80% of the projected revenues of between $2 billion and $2.5 billion for the fiscal year 2010 and that the WiMAX initiative will be positive for operating income before depreciation and amortization (OIBDA) in 2010, and start generating a positive free cash flow in 2011. Meanwhile, the company plans to spend about $2.5 billion in capital investment for WiMAX through the end of next year and after that follow a “success-based” network build. Sprint Nextel estimated that expanding the network to its planned 125 million pops by year-end 2010 would cost another $2.5 billion.
At the Virginia event, Sprint Nextel also addressed how the 2.5 GHz spectrum that it plans to use for its WiMAX service compares to spectrum up for auction at 700 MHz.
“The great thing about 700 is that it goes a long way,” said Barry West, Sprint Nextel’s CTO and president of its 4G mobile broadband group. “The problem with 700 is that it goes a long way. .. We have a huge capacity advantage.”
Barry said that while 700 MHz has better propagation, 2.5 GHz spectrum provides a lot more capacity. While initially it takes two to three times as many cell sites to be deployed for initial coverage at 2.5 GHz compared to 700 MHz, 10 to 15 sites are required at 700 MHz for the same capacity as one Sprint Nextel WiMAX site at 2.5 GHz.
–Other tidbits from the conference:
–Sprint Nextel also considered the name Outjack for its WiMAX service.
–The first WiMAX devices will be PC cards certified by Sprint Nextel.
–The carrier is considering two business models: one would be session-based and the other would be subscription-based.
–WiMAX chips initially will cost $20, but rapidly decrease to between $5 and $15.
–Sprint Nextel expects general speeds of between 2 an 4 megabits per second, with peak speeds of 10 mbps.