Subject: [NEXTEL-1] McCaw building another venture, Clearwire: high-speed wireless Internet Service

From: [email-masked]
Date: Fri, 30 Apr 2004 13:09:27 -0400

McCaw building another venture 

By Tricia Duryee
Times Eastside business reporter

Craig McCaw has formed a new company that could be the launching pad 
for his next business venture. 

McCaw, the wireless mogul who started what is now AT&T Wireless, 
last month merged his Kirkland-based Flux Fixed Wireless company 
with Clearwire Holdings, based in Arlington, Texas. 

Clearwire provides high-speed wireless Internet service and holds 
leases to broadcast spectrum allotted to schools in the 1960s for 
television programming. 

McCaw is listed in regulatory filings as owning at least 10 percent 
of the new company, known as Clearwire Corp. He is an executive 
officer and director, and Clearwire's senior management and 
shareholder lists are stacked with former McCaw Cellular and AT&T 
executives. 

It's unclear how much investment the Clearwire acquisition 
represents; terms of the merger weren't disclosed. But some 
observers see similarities to McCaw's past ventures, giving the 
impression it could be the cellular pioneer's next big thing. 

"This is the kind of thing that, if he was going to put his own time 
into, this is probably it," said Steve Wood, chief executive of 
Bellevue-based Wireless Services. "It certainly fits with his 
background." 

McCaw is best known for starting McCaw Cellular Communications, 
which he sold to AT&T for $11.5 billion in 1994. He later rescued 
Reston, Va.-based Nextel Communications in 1995 by investing about 
$1.1 billion to make it one of the country's largest carriers. 

The Clearwire position could be the first leadership role the 
reclusive businessman has taken since resigning from Nextel 
Communication's board late last year to start investing and working 
with young companies. 

He is known to have invested in Bellevue-based RadioFrame, which 
develops technology designed to improve indoor wireless phone and 
Internet access for companies, and in NextNet Wireless of 
Minneapolis. 

The merged company will be based in Kirkland. 

As part of the merger, the broadcast-spectrum leases were assigned 
to the new entity, according to Todd Wolfenbarger, a spokesman for 
Eagle River, McCaw's investment arm. Wolfenbarger would not say 
specifically what the licenses would be used for. 

 
"Craig's been very active in wireless investments for a long 
time. ... Clearwire is another one of these that's he's made. He 
continues to believe there's an opportunity in the space," 
Wolfenbarger said. 

The Clearwire transaction was completed March 30, according to a 
document filed with the Securities & Exchange Commission. 

In addition to McCaw, other former McCaw or AT&T employees of his 
were listed as having a 10 percent stake, and either a leadership or 
director role. They include: Gerard Salemme, the company's 
president; Nick Kauser; James Mansour; and Rob Mechaley. Mechaley is 
founder and chairman of RadioFrame. 

Clearwire, which raised more than $100 million in venture capital 
since its 1998 start, focused on leasing spectrum called 
Instructional Television Fixed Service (ITFS), used by schools to 
broadcast television programming. 

Commercial companies and educational entities have both long 
supported using the spectrum for more than education, said Patrick 
Gossman, director of academic technologies and customer services at 
Wayne State University in Detroit. 

Gossman, chairman of the National ITFS Association, said the Federal 
Communications Commission recently made the rules more flexible on 
how the spectrum can be used. 

License holders are awaiting direction on how the rules will be 
implemented, Gossman said. The FCC could decide this summer, he 
said. 

ITFS spectrum has the advantage of being used by one entity at one 
time. By contrast, wireless spectrum, or WiFi, can experience 
interference. 

Wood, who was part of McCaw Cellular's executive team, said he has 
been aware of McCaw, Mechaley and Kauser acquiring spectrum for more 
than a year. 

He figures they are interested in buying spectrum, as McCaw did to 
create his national cell carrier and then later with Nextel 
Communications. 

"He's done it several times," Wood said. "This is his new gobble-up-
the-wireless-spectrum venture." 

Tricia Duryee: 206-464-3283 or [email-masked] 

http://seattletimes.nwsource.com/ABPub/2001916074.jpg

http://seattletimes.nwsource.com/html/businesstechnology/2001916212_clearwire30.html

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