Ben Wolff on nationwide WiMax and the killer app

Ben Wolff is CEO of Clearwire Corp., a WiMax wireless Internet service provider founded in 2003 by wireless pioneer Craig McCaw. Clearwire recently finalized a merger with Sprint Nextel Inc.'s WiMax business, and the newly merged company aims to roll out high-speed wireless service nationwide in the next two years, aided by a US$3.2 billion investment by Google Inc., Intel Corp. and three cable companies. The WiMax service is already operational in Baltimore, and service in several other major cities is on the way.

What is the flagging economy going to do to your very ambitious plans for a national WiMax wireless rollout with Sprint and other investors?

The great news is that we've got $3.2 billion of cash coming in. If that sounds like a lot, it is. We can last a long time on $3.2 billion. We don't have a huge amount of pressure to go out and get additional financing.

We're well positioned to ride out the financial market storm. It would be different if we didn't have the [deal] with Sprint, Google and the cable companies for a joint venture to build the network.

What will it cost in total to build a national WiMax network?

Close to the $7 billion range. But it's still a dramatically lower cost than what you've seen in traditional cellular builds. And there are good reasons for that. We are using a flat, Layer 2 IP network architecture, much more simple than what you see in traditional cellular. Also, the equipment that goes on the cell tower is smaller, lighter, more compact. The costs are dramatically less.

What impact will the poor economy have on WiMax?

Will a person in danger of losing his job pay for it? If you add up the cost for residential broadband for Internet [and] residential voice service, and then add on mobile Internet and mobile voice service, the average household today spends $150 to $300 per month. If Clearwire can offer you all those services for $100 to $125 a month -- and that includes each of four people in your house with his own phone number that will work on any device, including the home phone -- I think that winds up being a value proposition. And it will be a better experience.

The deal for the joint venture with Sprint closed Dec. 1. How is the integration going?

Integration efforts bringing the two teams together are going very, very well. It is a big task. Challenges that mergers traditionally have include bringing the teams together. Clearwire has about 1,800 people, and Sprint has about 700 at Xohm, the WiMax division . It is not a small undertaking, but not as cumbersome as some mergers.

Google's involvement is intriguing. What's its role going to be?

It's across the board. They and we are very aligned philosophically about the ability to deliver true broadband to the palm of your hand so it's available anytime and anywhere -- that's good for their business and good for our business, and good for consumers. Second, their work on the Android platform is really groundbreaking, so we expect to have devices on our network that use Android -- not exclusively, but as an option. In addition, Google is one of the most innovative companies out there today focused on how to bring the Internet to a smaller screen and to make it relevant in a mobile environment, with applications tailored to you as a consumer. We hope to do joint R&D for applications they are creating for the 4G network.

What will be the WiMax killer app?

I hope there will be a number of killer apps. But one is live video chat.

Videoconferencing?

That's got an enterprise connotation, but what I mean by video chat is where you are able to push a button, transmit and then see each other and talk to each other, real time, across the country. It's possible because WiMax has very low latency. I think the ability to have face-to-face communications -- see body language, all that -- will be a killer app.

Is there a corporate dimension to video chat where the boss talks to a worker or shares, say, training and product information?

Yes, you're dead-on with those business applications. Plus, you could multicast to many workers, similar to push-to-talk from Nextel, but with video. Think about doing that nationwide. That has real utility.

So, is WiMax focused on consumers or businesses, or both?

It really depends on the device you have. Clearwire before the merger [was] a mass-market broadband provider of mainly fixed WiMax to the home and small office, with nearly half a million subscribers. That's clearly a mass-market, consumer play, not targeted at the tech-savvy early adopter. But USB dongles or laptops with WiMax cards in them can provide real productivity tools for real estate agents or insurance agents or others who spend a vast majority of their time moving around in their local communities carrying laptops. And there are a lot of those people. Students are also a great market for USB WiMax cards or dongles. But the Nokia N810 is more for the early-adopter, tech-savvy type of user. We will target products for different segments of the population.

Is there a WiMax market for large business users?

I think there is. Sprint teams inside the new Clearwire [will] go after that segment, while Clearwire [will] focus on others. WiMax is a very secure network.

And the timing for WiMax?

We'll start by trying to have our network provided for 140 million by 2009 or 2010. Most of that will be top-100 markets with denser populations. We'll build in clusters. If you build Boston, you build surrounding areas of Boston as well.

Getting back to the economy -- if things get much worse, what does it mean for the big picture for all kinds of technology companies, not just Clearwire?

Current economic conditions are so dramatic in terms of the debt side of the financial markets that it can't last. We're finding that this is a world economy, which is more apparent than any of us realized. There are also regulatory and policy fixes. Those won't snap us out of a recession but will get us on the right path. Still, our intellectual property -- inventing things, like software -- has become our tremendous national resource.

This version of this Q&A originally appeared in Computerworld 's print edition.