In 2007, when Cisco bought Navini Networks for $330 million, the speculation was that the company was positioning itself for doing business with Sprint and Clearwire. If so, the plan worked; Clearwire (now a subsidiary of Sprint) will rely on Cisco as its primary source of core networking equipment.
Cisco is leveraging the relationship as a means to another of its stated ends: worming its way further into the consumer market. Cisco simultaneously announced plans to build new mobile WiMAX devices for Clearwire’s Clear mobile WiMAX service for the consumer, small office or home office (SOHO), and small- and medium-size business (SMB) markets.
Intel is building WiMAX technology directly into the chips it makes for computers, creating a ready-made potential market for WiMAX connectivity. The approach is similar to the way Wi-Fi was made popular. Another key factor in the equation for the success of WiMAX is a rich ecology of subscriber equipment.
Cisco will contribute to that. The company promises its first mobile WiMAX subscriber equipment will debut later this year. The product line will include routers from another Cisco acquisition – Linksys.
Neither Cisco nor Clearwire discussed the financial terms of the multiyear deal.
Cisco will be the primary IP network solution provider for Clearwire's 4G network. Clearwire has selected, and is in the process of testing and certifying, a Cisco Internet Protocol Next-Generation Network (IP NGN) architecture that includes Cisco 7600 Series Internet routers, Cisco ONS 15454 and Cisco ONS 15310 platforms, Cisco ASA Firewalls, and the Cisco Service and Application Module for IP (SAMI) Home Agent.
The deal between Clearwire and Cisco was presaged by the recent announcement of their establishment of the WiMAX Innovation Network for developers, which will initially cover more than 20 square miles in Silicon Valley. Clearwire and Cisco said they will set up a network covering about 20 square miles in Silicon Valley, an area that includes some campuses occupied by Google and Intel, who not coincidentally are major investors in Clearwire. Cisco will provide IP NGN equipment in support of the WiMAX Innovation Network. The service is expected to be available to developers by late summer of this year.
Clearwire currently has relationships with Samsung and Motorola for base stations. Nokia Siemens Networks (NSN) had been a contender for the core IP network secured by Cisco, though it is now out of the running for that deal. Clearwire didn’t rule NSN out for future contracts.
The first adopters of WiMAX technology were outside of the U.S., where Navini had already established a presence. Cisco has been working the international markets since buying Navini, and it recently announced that it is supplying mobile WiMAX infrastructure to Russian wireless ISP Scartel, Georgian mobile operator MagtiCom and AsiaBell's mobile WiMAX service in central Kazakhstan.
– Wireless Week’s Maisie Ramsey contributed to this report