If you read my article a couple of days back, you’ll know I think Garmin’s nuviphone will roll out on Sprint’s Clear’s Xohm network. But if I’m right, the nuviphone could be delayed again. If you’ve been following the Xohm-Clearwire merger, you’d know that it was confirmed last Friday. Comcast, Intel, Time Warner Cable, Google, and Bright House Networks invested a combined $3.2 billion in the network, which promises fourth generation WiMAX broadband to over 140 million people by the end of 2010 on the Clearwire network alone.
The problem lies in the fact that Clearwire needs another $2 billion to $2.3 billion to build out its network. While the company has announced near-future funding from Trilogy Equity Partners, if it doesn’t raise the required amount of money, chief executive Benjamin Wolff says that hurting credit markets could cause WiMAX to roll out slower than initially planned if they don’t improve by early 2010.
While Wolff believes that WiMAX is about two years ahead of rival fourth generation long term evolution (LTE) networks, the fact remains that if the WiMAX user base remains stunted for longer than expected, Garmin’s nuviphone will most likely be delayed again. Well, if my prediction that Sprint Clear will carry the nuviphone is correct.
The way it stands now, with Baltimore being the only official WiMAX market, it wouldn’t make too much sense for Garmin to roll out the nuviphone. Even if the expected markets were available in Q1 2009, I doubt the population would support it, especially with the iPhone available now. And that would mean crippled fourth quarter earnings for Garmin. Look what happened when they delayed the nuviphone in the 2nd quarter–a nice share price decline.
If WiMAX is slow to emerge once again, will the Garmin nuviphone be delayed? I’d bet on it. What do you think?
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