Sprint Nextel Corp. and its partner Clearwire Corp. are close to inking a pact to extend their network sharing agreement for three to five years, according to a report.
The agreement would allow Sprint to use Clearwire’s network to provide services to its customers after the current deal expires at the end of next year, Bloomberg reported, citing three people familiar with the matter.
The report is yet another sign that Sprint – the third-largest U.S. wireless provider with a majority stake in Clearwire – is not abandoning its relationship with Clearwire in spite of Sprint’s plans to transition to LTE 4G technology from WiMAX.
Sprint Chief Executive Dan Hesse revealed on Wednesday that the company had reached a non-binding agreement with Clearwire regarding LTE.
Sprint is a major investor in Clearwire and its largest wholesale customer representing 34 percent of Clearwire's total revenues through the first six months of 2011, but the companies fell into a dispute earlier this year over wholesale pricing that threatened to sever their relationship.
Managing a capital-intensive business, Bellevue, Wash.-based Clearwire has incurred $1.73 billion in net losses from continuing operations through the first six months of the year. In its second quarter results filed with the Securities and Exchange Commission on Aug. 4, the company said it had $829.4 million in cash and short-term investments available as of June 30 and believed it had sufficient cash to fund near-term capital needs for at least the next 12 months.
In November 2008, Clearwire and Sprint announced completing a transaction to combine their next-generation wireless Internet businesses. At the time, Clearwire also disclosed that Comcast, Intel, Time Warner Cable, Google and Bright House Networks had invested $3.2 billion in the company.