I’m no analyst, but I can see when a properly schooled one is either spreading FUD or is simply clueless. FUD is only dangerous when fed to the clueless, who it so happens are often the majority of fund managers. I’m assuming Mike is just not up to speed on WiMAX, and that his FUD is unintentional.

Quoting McCormack:

“While we believe Clearwire has amassed an attractive spectrum position that enables the delivery of competitive wireless speeds, we are concerned about the competitive landscape for both residential and mobile services, the impact of the weak economy and the appetite for business partners to sell Clearwire services,” he writes.

McCormack notes that the company plans to offer wireless broadband service at 2-4 Mbps, which is above the 0.6-1.7 Mbps offered by the national carriers currently. In some markets, he notes, Clearwire expects to offers speeds of 6-15 Mbps, “easily” outpacing 3G speeds. But McCormack says he questions whether end users are demanding that kind of speed. (Barrons)

If you only understand the concept of broadband in the context of a landline or a cell phone, you will have missed the following:

1) The average fixed broadband user in America has access to a top speed in the 2-4 GBPS range, making Clearwire’s initial speed offering competitive in with fixed line service in most markets. Wimax has the potential to deliver far faster speeds than ADSL or DOCSIS 2, so there’s plenty of headroom to stay competitive.

2) As for mobile, there is not even a complete standard for a 4G implementation on the telco side yet, and when there is they are still not capable of delivering the same speeds. The spectrum held by Clearwire does not penetrate buildings as well as the incumbent telcos 700mHZ real estate, but Clearwire’s allocated bandwidth is much larger - meaning far faster wireless connections are possible.

3) VoIP enabled devices, both portable and fixed can easily displace old school fixed line and mobile voice service without any additional investment from Clearwire. Since Clearwire is offering an open network, new capabilities will surface and grow viruly,  always placing new technologies and services on their network first.

4) Yes, you have to be competitive. Study after study has shown that most broadband users want more speed for less. Give them that and they are yours. Offer it for either fixed or mobile use with a single infrastructure, and you have a huge cost advantage over the incumbents, as well as a unique offering.

5) There is no shortage of willing business partners to sell the service.  Startups always follow layoffs even if the traditional cell phone shops are not interested or get bullied by the incumbents. Also, there’s is no bullying the likes of Best Buy, Office Depot, Staples, Target and Walmart even if you are AT&T or Verizon.

Please don’t take me as a mindless Clearwire fanboy. I have concerns about its viability, but from a perspective of the firm’s ability to build enough national coverage to be a viable mobile player for the traveling user (who is also typically the biggest spender) as well as its ability to market the service. Only time will tell if there is enough money and savvy in the Clearwire camp to make it happen.

Clearly the technology and spectrum gives Clearwire a leg up on the competition if they can execute the business plan well.

Not to slam our current crop of tech and business reporters, but it’s refreshing to see an interview with a tech CEO done to the point with relevance. Done at the D6 conference, Om Malik Questioned Mr Bezos on how Amazon web services got stated and where it’s going. Om also brought Wall Street’s complete ignorance of the significance of the cloud computing wave into focus.

• How and when Amazon began its cloud computing effort.
• Why Amazon has become an innovator with Amazon Web Services and how it relates to their core business of being an online retailer.
• Whether or not Wall Street recognizes Amazon’s cloud efforts.
• What’s next for Amazon Web Services.
• Whether or not Amazon has plans for a VC fund or for cloud computing startups. (GigaOm)

It’s hard to trust analyst’s motives, but it’s also hard to ignore their predictions even though they are often dead wrong. In this case we have a respected firm declaring that Sprint’s long awaited Wimax service is on target for a summer launch.

ThinkEquity Partners is claiming that Sprint Nextel Corp. (NYSE: S - message board) will launch its initial Xohm WiMax networks in early summer.

The analyst firm, which has been one of the key cheerleaders for Clearwire LLC (Nasdaq: CLWR - message board) and Xohm in recent months, says that that initial “WiMax network launch” for the Xohm service will happen in Chicago, Baltimore, Washington, and Portland, Ore., “mid-year” with “others following closely behind.”

Chicago and Baltimore-Washington were the initial markets slated for an April launch by Sprint, which has subsequently been delayed. Portland, meanwhile, is a Clearwire market, and the analyst firm continues to suggest that a link-up between the two WiMax rivals will happen sooner rather than later. (Unstrung)

With the lions share of the wireless spectrum now in the hands of the same two companies that control the lions share of fixed line access, this launch is of monumental importance. I could also be the saving grace for Sprint. With so much at stake, I hope the analysts are up to more than just trying to talk up Sprint’s stock.

Wall Street analysts are an odd bunch. They try to fit companies into neat little cookie cutter profiles and insist you make yourself fit into one - even if you don’t fit. It makes your company easier to analyze and market to investors. Chances are you’ll fail if you try to fit their profile no matter how hard you try, so it may be better to resist and let them trash you now rather than have them blame you for inevitable failure later.

Qwest had their meeting with said analysts today. Analysts want to know what Qwest will do to look more like the AT&T Death Star or Darth Verizon with triple play and now saturated wireless. Sticking to plan, Qwest Chairman Ed Mueller told them that the future is a big dumb pipe and that they would do wireless and pay TV through partnerships:

“The line that comes into the home is a connection, and not a telephone number,” says Mueller, “and that’s important” in order to not be simply pushed aside by cellular offerings and fiber-optics.

The company expects it will pass 1.5 million homes with its fiber-to-the-node lines by the end of this year. The company says this could add 1 percentage point to revenue growth in the second year of the initiative, and Mueller thinks Qwest can increase its share of consumer broadband in its markets from 32% currently to 45%, without specifying a time frame.

More on Qwest to analyasts: The future is a big dumb pipe. Get used to it!

In an move to quiet some very angry stockholders Comcast announced profits are up and declared a dividend:

Comcast’s stock has taken a beating of late for a variety of reasons. All the talk of FiOS has many of them worried, as did the looming (and so far unfounded) rumor that the company was interested in making a major wireless broadband play. But the company’s fussy investors got a gift this morning with Comcast’s fourth quarter earnings results, which bested most analysts’ estimates. The company reported higher than expected profit for Q4, and announced a new annual dividend payout for shareholders.

Comcast Corp. announced plans for its first dividend in nearly a decade and committed to a timeline for buying back nearly $7 billion in stock, a salve to investor complaints the cable giant isn’t friendly to shareholders. The moves Thursday come as Comcast’s stock price has withered and just a month after one of the company’s biggest investors accused Comcast of a litany of missteps and called on the company to commit to shareholder givebacks, including a dividend. (from Broadband Reports)

The company has been performing a well choreographed tapdance before the FCC trying to explain that they really are delivering service as promised to consumers even though they are not.

Just to let cutomers know that the company is fully committed to creating a robust network capable of delivering a 21st century level of broadband access, they are rumored to be investing $175 million in social networking loser Plaxo. I for one wonder how fiber nodes could be upgraded, how many more DOCSIS 3 loops could be deployed or how much better a dividend could be paid out with the same said $175 million.

Microsoft’s relevance as a technology company is quickly fading away just like those old Polaroid prints from the 80’s that we all thought would last forever. Yahoo was not ready to join the evil empire unless the price was so silly that they could not resist. After all, Microsoft was mostly interested in existing relationships, not the company itself. Now it’s rumored Rupert Murdock will join the bidding. Not only does a News Corp / Yahoo combination make more sense (I still prefer a stand alone Yahoo), but News Corp has been much better at integrating acquisitions than has Microsoft. It could be just maturity, but I think it’s just a bit more savvy in a seasoned publisher vs an upstart who made his fortune packaging and selling something that had been free and open before he arrived on the scene. More on Reuters

If you’re a new CEO of a company that attempting to rapidly make wholesale changes to slow the tide of fleeing customers, the last thing you want is a new knucklehead in the board room. Unfortunately for Sprint’s new CEO Dan Hesse, that’s just what he got today.

Ralph Whitworth, newly appointed as a director at Sprint Nextel Corp., will push the wireless carrier to consider major changes, including a sale of its Nextel network or the entire company, if difficulties continue, a person familiar with his thinking said.

More on New board member could mean more turmoil for Sprint

Hesse, Sprint’s new CEO looks to being prepared to shake up the Industry. Even to the point of a flat line plan to differentiate Sprint from the competition. ThirdPipe has been saying for some time that a flat rate world was coming to cellular. Sprint just might be the one to bring flat rate mainstream.

His arsenal is packed with “nukes” - Hesse-speak for anything that has the potential to disrupt the status quo in wireless. One possibility under consideration: flat-rate pricing for unlimited voice calls.

Such a plan, if offered, could shake up the U.S. wireless industry, which has long offered “buckets” of minutes for a set price.

Hesse says he’s made no final decision about unlimited calling, but he also makes it clear that he’s going to do what it takes to differentiate Sprint from AT&T (T) and Verizon Wireless (VZ). His goal: drive customer sales through the roof.

“If we can’t be different, we can’t win,” he says flatly.

Continuing…

ncremental steps won’t stop the hemorrhaging, Hodulik says. “They need to make some fairly drastic changes.” Jan Dawson, a telecom analyst at Ovum, agrees. “Sprint can be saved, but they’re going to have to be pretty aggressive about the steps they take to fix it.”

You’ll get no argument from Hesse. Shortly after taking the helm, he set up a war room in an adjoining office. White boards were installed along with blackout shades, allowing Hesse to freely jot down his thoughts but still keep them secret, if necessary. Hesse has the only electronic key to the room, which is off-limits to everybody - including the cleaning crew - unless Hesse is present.

Giving a reporter a rare tour, Hesse draws back the curtains far enough to reveal a few category headers: “Nukes,” “Strategy” and “People” are among them.

Fallout from the brainstorming bunker is coming quickly. Hesse recently announced plans to slash 4,000 jobs and shut hundreds of underperforming retail outlets and other distribution points. Hesse also removed three top executives, including the former chief financial officer, Paul Saleh, who until recently was acting CEO.

Hesse says he’ll do what it takes to protect and promote Sprint’s unique assets, even if it means upsetting the status quo.

“We’re looking at all sorts of things that could be disruptive to the (wireless) industry,” he says matter-of-factly. Plus, he says, “I like to be on the offensive rather than the defensive.”

Lets say Sprint offers a flat rate no holds barred plan. How will the competition react? One way of course is to match. The other to discount bundles that appear to match Sprint but retain the higher income stream. But the fact is none will be able to overcome good pricing and simplicity. Two things consumers desire are not having to count minutes and a fixed pricing.

First company to adopt such a plan at a consumer favorable, company sustainable price^ will be in the cat bird seat.

Linky.

^Does not a consumer any good to have below cost pricing if the provider folds 6 months later. It has to be favorable to all three parties — consumer, company, and shareholder.

It appears that Yahoo might be right in stating that possibly they are undervalued. Both Google and Yahoo have scored deals in the mobile marketing arena. It is the next pot of gold for firms like Google tying Place with marketing.

Google Inc. and Yahoo Inc. each announced impressive wins in the mobile search space at Mobile World Congress 2008.

Nokia Corp. said it will begin to include Google’s technology with its own mobile search application “in select markets,” integrating the search on the Nokia N96 and N78 — which were announced this week at the MWC — as well as the 6220 and 6210 Navigator.

The deal builds on an existing relationship that has integrated Google’s search engine with Nokia Internet tablets. While the collaboration initially is limited in scope — including a fraction of the three dozen-plus devices that feature Nokia Search — the Finnish firm said it plans to make Google search available to customers in more than 100 countries and in 40 languages.

“Providing choices for our consumers is an important driver in Nokia’s Internet service strategy,” said Ilkka Raiskinen, Nokia’s VP of software and services. “This integration allows our consumers the ability to use the innovative search technologies (that) have made Google almost synonymous with Internet search.”

But Google was forced to put a mark in the loss column, too, as T-Mobile International announced plans to make Yahoo its exclusive mobile search service in Europe at the end of March. T-Mobile said it will offer oneSearch to customers in its 11 European markets as part of its web’n’walk offering; the companies also announced plans to offer Yahoo services such as e-mail, instant messaging, weather information and the photo-sharing application Flickr.

If Yahoo is successful in making tie ins to Place with its tools the valuation that Microsoft attributes to the firm might actually be too low. On the other hand if Yahoo cannot realize the tie in then all bets are off of course. Will Yahoo pull it off?

Linky.

This ladies and gentlemen is a prognostication. For the astute it could help them align their business goals. For others a opportunity of a different sort. And for still others this will fall on deaf ears. The point ladies and gentlemen is that the credit markets are at a roiling boil and that is not a good thing. A few data points if I may

“So the bottom line is that what the payroll data have missed is the fact that over the past six months, 520,000 self-employed individuals have fallen by the wayside (more than were lost in the entire 2001 recession). This may also be why it is that claims are suppressed – having never paid into the unemployment insurance program, these people are not necessarily entitled to any benefits. The population- and payroll-concept adjusted data show that employment fell 400,000 in November-December combined (because Thanksgiving landed so late in 2007, both months have to be looked at together, whether it be for jobs or retail sales). So we think the view that job growth is hanging in is, just in plain simple language, wrong.”

Look for unemployment to rise to 6% (or more) in the coming quarters. This will of course put a damper on consumer spending.

Self Employment is dropping sharply. The suspected cause in my view - ‘A’ level firms pulling back on contracted labor and doing more in house.

Goldman Sachs CFO David Viniar warned yesterday that some key mortgage bond insurers could collapse. Viniar, speaking at a CSFB conference, said credit markets are trading as if we are in a “worst recession”; and there is a “total disconnect between the equities market and the credit market.” (The Bill King Report)

There was a convention this week in Las Vegas of the American Securitization Forum. I talked to good friend Michael Lewitt who attended the conference, and he said the mood was simply dismal. The credit markets have gone from bad to worse. There’s almost no trading being done in the $2 trillion Collateralized Debt Obligation (CDO) markets. Perfectly good bank loans are trading at discounts of between 10-20% to par, in addition to much higher and wider spreads. There are a lot of opportunities for intrepid investors who can distinguish solid value, as funds, banks, and pensions are having to unload loans without regard to value. It is a buyer’s market. Let’s take a look at a few graphs from www.markit.com.

Which presages a tightening of credit across the board. We are already seeing this in the consumer credit card debit side. BoA jacking up rates on my customers cards to 28% in expectation that they will encounter a run of CC debt defaults. Finally this –

…Cue lawyers. I was recently sent a link to a conference that will be held in New York next month. It is basically for people who are interested in litigation over the subprime and credit mess.

Look at some of the topics: “Look inside the mortgage industry, its underwriting, risk analysis procedures and loan approval technology…Get up-to-date on who is suing whom and the status of the recent wave of securities complaints … Learn the key elements necessary for proving or disproving fraud and negligent misrepresentation … Find out what to look for when it
comes to disclosures, disclaimers and limitations on standing … Learn the role played by
rating agencies, insurers and the feds … Acquire the skills necessary to successfully
prosecute or defend mortgage-backed securities suits.”

Simply means that those hedge funds that lost loads of cash are lawyering up. So are the ratings agencies. But distractions hamper business.

So this affects the ThirdPipe world how?

• Frivolous activity usually falls by the wayside in a downturn. And we are in one my friends. Folks liike Sprint will probably roll out Xohm much more slowly, having to depend on current income to finance further expanion rather than using what was cheap debt. Xohm frivolous? Well considering that their core business is still cell calls, yes.
• AAA rated firms would actually see their loan rates drop as lenders look to quality as a cover for their cash. Anyone below an A rating will see their loan rates rise sharply. That increased cost of funds will cause many companies to reevaluate their internal IRR for what were funded projects for the year. Many project leaders will be sorely disappointed if not unemployed.
• Based on the observations above strong balance sheets will put Google, Verizon and AT&T at a better advantage than folks like Time Warner, Sprint and Yahoo.
• The VC folks will have a major uptick in show-n-tell coming thru their front door. With debt financing either unavailable or too expensive to make an idea fly, many will return to the VC route to get their darlings off the ground.
• A major opening for Open Source. As project leaders react to VP’s announcing 20% cuts in programs, the price differential between using FOSS vs Proprietary solutions will be critical. Fact in many cases it could make the difference between a program continuing or folding altogether.
• Consumers in a belt tightening mood will opt for UMPCs like the Asus eePC or Everex Cloudbook at $399 vs a Dell latitude or HP Pavilion at $599.
• Accelerated device level consolidation. Consumers will move to shrink their data streams and financial outgo. Why continue with separate devices when a smartphone could do? Of why shell out $499 for a smartphone when a eePC w/Wimax at $499 could do that an more?

The world of ThirdPIpe will roll forward. But speed with which it proceeds may slow. The majors may garner a tactical advantage. Consumers will be looking for value not glitz.

Debt of gratitude to Bill Mauldin of www.frontlinethoughts.com for the data sourcing for this article.