bmichaud Posted June 27, 2011 Author Share Posted June 27, 2011 http://www.telecomramblings.com/2011/06/is-lightsquared-doomed/ Link to comment Share on other sites More sharing options...
brker_guy Posted June 30, 2011 Share Posted June 30, 2011 better question: is clearwire doomed? peter_burke_ceo, I have a simple answer: HELL NO!!! Just go look at this report: http://www.gpsworld.com/gnss-system/the-economics-disruption-96-billion-annually-risk-11825 http://www.wirelessweek.com/News/2011/06/Policy-and-Industry-House-Block-FCC-Permit-LightSquared-Government/ "The House Appropriations Committee adopted an amendment to its 2012 appropriations bill that would stop FCC funding "to remove conditions on or permit certain commercial broadband operations until the FCC has resolved concerns of harmful interference by these operations on Global Positioning System (GPS) devices." Don't buy into the LightSquared BS hype and look at the facts! BTW: If Sprint chooses to adopt TD-LTE, CLWR will pop... Link to comment Share on other sites More sharing options...
bathtime Posted July 28, 2011 Share Posted July 28, 2011 Any take on CLWR at these prices given the Sprint /Lightspeed deal this morning. Would like to see whether Glenview has been adding in their next quarterly update. Link to comment Share on other sites More sharing options...
ubuy2wron Posted July 28, 2011 Share Posted July 28, 2011 http://www.telecomramblings.com/2011/06/is-lightsquared-doomed/ better question: is clearwire doomed? From todays action I think there is a pretty good chance that CLWR, S and light speed are all heading for bancruptcy. This entire drama is a text book example of human folly. Falcone is an expert in distressed debt perhaps this is his game plan but I suspect his investors may make this very difficult for him. Who would put new capital in any of these entities at this stage and they all need boat loads of cash to make their existing business viable. Link to comment Share on other sites More sharing options...
txlaw Posted July 28, 2011 Share Posted July 28, 2011 I've taken a bath on CLWR. Luckily, it's been a very small position in my portfolio. I've decided to take the losses to offset some realized capital gains and revisit when Sprint announce what their 4G strategy will be. The Sprint quarter shows exactly why this game they are playing with L-Squared and Clearwire (which is pretty much Sprint) is hurting shareholders. I don't get their strategy. Is Goldman really getting paid to give them this sort of advice? As Sprint dilly dallies, there is an increased risk of losing postpaid subscribers to Verizon and AT&T's LTE services. I doubt S is heading into bankruptcy, but major dilution does seem like a real possibility. CLWR could potentially head to BK. Who knows what the hell will happen to LightSquared? CLWR common does seem to trade below what would be received in liquidation or a reorg, but do I really want to go through a reorg or liquidation to realize that value? Link to comment Share on other sites More sharing options...
bathtime Posted July 28, 2011 Share Posted July 28, 2011 Thanks for the thoughts! Link to comment Share on other sites More sharing options...
brker_guy Posted July 28, 2011 Share Posted July 28, 2011 If you are concerned about CLWR's survival, make your voice be heard by signing here to complain with the FCC: http://www.gpsworld.com/survey/lightsquared-comments-i-submitted-fcc-11927?utm_source=GPS&utm_medium=email&utm_campaign=Survey-Scene_07_27_2011&utm_content=lightsquared-comments-i-submitted-fcc-11927 Link to comment Share on other sites More sharing options...
bmichaud Posted August 15, 2011 Author Share Posted August 15, 2011 Full disclosure for where I stand with Clearwire... Established a position in the common at $3.90, sold out of the common at $3.10 and established a small position in Jan. 2012 calls. I originally established a position based on the thesis that Sprint absolutely needed CLWR for current business purposes as well as to compete with Verizon. I believed it was reasonable to assume that the fact that CLWR has the ability to operate the nation's largest and fastest 4G-LTE network due to its massive spectrum holdings, that Sprint would want to work with CLWR sooner rather than later in order to catch up with Verizon. Sprint was originally suppose to reveal its 4G strategy this July, which I believed would include an announcement of its cooperation with CLWR to roll out a 4G-LTE network. Upon the announcement of a clear (no pun intended) strategy and funding from its largest partner, I further believed the market would shift its focus from CLWR's uncertain funding and strategy issues to the value of its vast spectrum holdings. Well true to form, Dan Hesse revealed through an interview with the Boy Genius blog in July that he would not reveal Sprint's 4G strategy until October, has continued to play games with Lightsquared, and more recently reported disastrous results leading to a hideous decline in both Sprint and Clearwire's respective stock prices... I included CLWR in my special situations portfolio due to the near term nature of Sprint's 4G announcement in July. When Hesse delayed that announcement I exited my common stock position due to the games played by Hesse and the lack of desire to see my CLWR investment through a BK process (despite the likelihood common holders would most likely receive $2 to $4 in a liquidation). I still believe strongly in the value of CLWR's spectrum position, but just decided to pursue the opportunity how I should have in the first place - as an event stock with a near term catalyst, and thus via the options market. It has recently been rumored that The Sprint BOD is considering an investment in CLWR, which would be hugely positive for the stock considering more than 30% of the float is sold short. Stay tuned.... Link to comment Share on other sites More sharing options...
JHelg Posted August 17, 2011 Share Posted August 17, 2011 I've got more into CLWR than I probably should, but I feel pretty good about it. I was fortunately able to pick up a good chunk of shares in the most recent market turmoil. Things just seem to be falling into place lately, and I just don't see how Sprint moves forward without CLWR being a major part of their plan. Apart from the enormous value of CLWR's spectrum holdings, a few recent events/situations look very good for CLWR: 1. The rumored additional investment commitment from Sprint, referred to by bmichaud (see http://www.geekwire.com/2011/lifeline-clearwire-report-sprint-substantial-investment. 2. The recent announcement of CLWR's intent to add LTE to its network (see http://corporate.clearwire.com/releasedetail.cfm?ReleaseID=596508). 3. The near certainty that Lightsquared is not a part of Sprint's near future (just Google "Lightsquared and FCC" and you'll not doubt this for a moment). 4. And best of all, it looks like former CEO (interim), and now executive chairman of the board, John Stanton just bought a bunch of shares (approximately 2.75 million shares). (see http://files.shareholder.com/downloads/CLWR/1360654686x0xS1209191-11-44529/1442505/filing.pdf). I'm tempted to buy more, but I already probably have more than I should. I was introduced to CLWR by the board, so I thank all of you that brought this to my attention. I've done exhaustive research on the company, and while there is still certainly some risk, things are looking bright in my opinion. Link to comment Share on other sites More sharing options...
bmichaud Posted August 19, 2011 Author Share Posted August 19, 2011 http://www.bloomberg.com/news/2011-08-19/sprint-said-in-talks-about-clearwire-buyout.html Link to comment Share on other sites More sharing options...
JHelg Posted August 19, 2011 Share Posted August 19, 2011 Great find bmichaud. Any speculation as to what Sprint would pony up for CLWR? If Sprint got CLWR and the estimated cost of upgrading to LTE is correct, this could mean big things for Sprint as well. Link to comment Share on other sites More sharing options...
bmichaud Posted August 19, 2011 Author Share Posted August 19, 2011 I've seen a thousand variations of valuation math for CLWR, but back of the napkin, if Sprint paid 50-cents per MHz-POP (46.3B), and assuming a $2B spectrum lease liability in addition to $8.2B of total liabilities, I can get to almost $13 per share. Of course Sprint will try to low-ball CLWR investors, so I would not expect anything close to that price... Link to comment Share on other sites More sharing options...
bmichaud Posted August 19, 2011 Author Share Posted August 19, 2011 The following note regarding the CLWR buyout rumors is by Walter Piecyk of BTIG Research... Will Cable save Sprint? Episode 2(0) Posted on Fri, Aug 19th, 2011 at 9:14 am by Walter Piecyk — POSTS | DISCLAIMER Twitter RSS Email Phone: 646-450-9258 Chat with wpiecykbtig Categories: Wireless, Equity Research, USA Tags: S, CVC , CMCSA , TWC , CLWR , LightSquared The speculation of a strategic deal between the cable companies and Sprint has existed for over a month in various iterations. Well, to be more clear, speculation of some type of cable/Sprint deal has existed for over a decade and included a failed quad play attempt in Pivot which was ended in early 2008, a year after it launched. The latest iteration of speculation about a cable/Sprint deal emerged a little over a month ago as Sprint’s latest attempt at a 4G partner LightSquared hit significant challenges with GPS interference. Click here for our July 14th note on this very topic. Today’s Bloomberg story does not materially change our view that Sprint will not be able to lure a large cable company into a strategic deal, but the story does add new details. If we are wrong (which would certainly not be a first), we believe it would take an offer of at least $10 per share to take control of Clearwire. What’s different in the Bloomberg story? The three principal items that are different in the Bloomberg version of the Sprint/Cable speculation is 1.It talks about an investment of cash by a cable company into Sprint as opposed to a contribution of spectrum. 2.For the first time the speculation includes Cablevision, which is not a partner in SpectrumCo, the joint venture of cable companies that owns spectrum. 3.Cites, as a source, three people that are “familiar with the deal” although we are never sure what that means as it is not stated as three people “involved” or “working” on the deal. October 7th looms large On its last quarterly conference call, Sprint announced that on October 7th it would discuss its 4G strategy. It has subsequently focused investors on this date and supposed negotiations that it is having with a new potential strategic partner. When asked questions that Sprint won’t or can’t answer, the investor relations staff have directed investors to October 7th, further building up the anticipation of that date. If the deal is not final why give yourself a deadline? If Sprint is in negotiations with a new strategic partner, they have effectively handed the other company a strong negotiating tool by building up the October 7th date. This is not unlike the negotiating tool that Sprint had with Leap Wireless when negotiating a roaming and wholesale agreement ahead of a disastrous Leap investor meeting. Apparently Sprint did not learn from that transaction on how having a deadline impacts negotiations. iPhone coming on October 7th? October 7th has also gained new significance earlier this week when technology blogs speculated that Apple plans to launch its latest iPhone on October 7th after officially announcing it on September 30th. (click here) Those that are bullish on Sprint could speculate that the similarity of the dates this means Sprint is getting an iPhone and previously knew of the iPhone launch date. Meanwhile, those that are bearish on Sprint could speculate that Sprint will be announcing a weak 5×5 LTE strategy on a day when people are lined up outside the stores of all of their competitors in anticipation of the latest iPhone. Time will tell. Why Clearwire could hold out for more than $10 in a buyout. We believe that a change of control at Clearwire requires the consent of all the strategic partners under a standstill agreement. We have not been able to evaluate the language of this agreement but none of the interested parties have denied this belief. That means that the willingness of public shareholders, that have been battered by the sell off in the stock, to sell the stock near the current stock price is irrelevant. Sprint could buy every share of public float and still not control Clearwire. Sprint will need to get the consent of strategic partners Intel, Google, Eagle River and several cable companies. We believe this means it would take more than $10 per share for Sprint to take control of Clearwire. What about the debt refinance? In our recent upgrade of Sprint to Neutral, we noted that the company would likely have to refinance the $2.3 billion of Q1, 2012 debt maturities before dealing with Clearwire. Even if Sprint were able to pass through the cash from a cable company investment in order to buy Clearwire, taking control of Clearwire would involve consolidating Clearwire’s $4.3 billiion of debt, adding nearly a turn of leverage to Sprint. One option would presumably include using the Bloomberg alleged cable company cash investment to pay down debt while Sprint uses its equity to buy Clearwire. In that scenario, the price tag that the strategic partners of Clearwire will require from Sprint would likely go up and for Sprint shareholders, this would mean billions of dollars of new stock issued to cable AND to Clearwire, while the stock hovers around recent lows of $3 per share. Pretty scary indeed, but Sprint’s lack of 4G strategy may have backed them into this very unattractive corner. What does Rich Greenfield think? Rich Greenfield, BTIG’s Media analyst continues to believe that the cable industry’s lack of a broadband strategy is not hurting them, in fact the robust bandwidth capacity of the cable industry’s landline infrastructure is their greatest advantage (see 8/2 blog click here). Time Warner Cable management threw “cold water” on the need for a more significant wireless strategy during their last quarterly conference call in late July. Glenn Britt, TWC Chairman and CEO: “Our strategy really hasn’t changed. I think you should look at it as one of optionality. We have this idea, we’ve had it for some time, that bundling wireless, broadband in with our other products to create a so-called Quadruple Play might be interesting to consumers. And the reason I say might is that we’re not sure and the marketing evidence is mixed. So what we’ve been trying to do is create the ability to experiment with that through market testing, et cetera, without investing and risking huge amounts of money. And all of our group to dates — all of our moves to date are in that context. As we said on a couple of calls, our results in terms of actual customers so far are not terribly exciting. So the evidence so far as there is not a big market for the Quadruple Play. So I think this strategy we’ve had is the right one. Where we go from here I think is more of the same. We’re not really ready to say that this is a non-starter, maybe we’re just not doing it right. But we’re also not ready to make huge additional debt. So that’s– again is consistent with where we’ve been.” “Okay, on wireless, as I said, we’ve been trying to make sure we had options if we find the magic marketing formulas. So Clearwire and the spectrum is in that context. As I think you know, there’s a fairly long time period for build out associated with that spectrum despite some of the political comments people make around this in Washington. So we’re going to keep trying to find out if there’s some formula that for Quadruple Play that works. If we find the magic formula, we’ll go from there, if we don’t, then we’ll take some other action. But again, nothing to announce at this point.” Read more: http://www.btigresearch.com/2011/08/19/will-cable-save-sprint-episode-20/#ixzz1VTtvx3fP Link to comment Share on other sites More sharing options...
CONeal Posted September 3, 2011 Share Posted September 3, 2011 Thinking about how ATT could get approved Where everyone benefits. ATT gives away some spectrum so that it does have such a large % of spectrum with one player. The spectrum goes to L2 to solve all this issues between GPS and the govt approving use of spectrum not available since it was actually able to support use. L2 and Sprint continue with their deal. Sprint also gives cash to Clearwire since they would still need spectrum for the foreseeable future. This is used to build out LTE. Clear wire would then be available for LTE use by all players which would become extremely useful in larger markets and help solve congestion issues. Off my rocker or does this sound feasible for the benefit of Clearwire and the entire industry? It may sound a skewed to benefit Sprint but the way I am viewing it is there would be a viable #3 player in the industry. Link to comment Share on other sites More sharing options...
JHelg Posted September 14, 2011 Share Posted September 14, 2011 Positive developments keep piling on with CLWR. Eventually Mr. Market will recognize the value of this spectrum. http://www.reuters.com/finance/stocks/CLWR.O/key-developments/article/2400069 I think this latest development suggests even more long term value in CLWR, assuming it doesn't get bought out before Oct. 7. Link to comment Share on other sites More sharing options...
S2S Posted September 15, 2011 Share Posted September 15, 2011 Positive developments keep piling on with CLWR. Eventually Mr. Market will recognize the value of this spectrum. http://www.reuters.com/finance/stocks/CLWR.O/key-developments/article/2400069 I think this latest development suggests even more long term value in CLWR, assuming it doesn't get bought out before Oct. 7. Not so fast. If anything, the announcement adds more uncertainty to the matter at hand: China Mobile is the ONLY mobile operator globally to peruse TD-LTE, a 4G technology CHL itself helped develop. All North America operators use FDD-LTE, the mainstream LTE technology. Chances are Sprint will go down that road when they deploy 4G, as well. I didn't see anything about cash changing hands. The reality is that CLWR needs cash. Desperately. Link to comment Share on other sites More sharing options...
JHelg Posted September 15, 2011 Share Posted September 15, 2011 I see this as a huge positive to CLWR, although I recognize I'm still relying on presumptions for my conclusions. Having partners like China Mobile open up a ton of very lucrative potential possibilities for CLWR--and, I think, adds a lot of credibility to Clearwire as an ongoing operation. First, this partnership will likely help Clearwire with economies of scale as far as devices are concerned. I think some have questioned Clearwire's intention to go with TD LTE, rather than the more mainstream FDD LTE. See http://www.fiercebroadbandwireless.com/story/paolini-has-clearwire-picked-right-flavor-lte/2011-09-06. As I understand it, there was some concern whether using the less popular (in the US, anyway) TD LTE would limit the devices available in the US. This would seem to be a non-issue now, now that China Mobile and Clearwire will be collaborating on new TD LTE devices (hint: do you think Apple wants a piece of the Chinese TD LTE market?). Likewise, all the phones that will be sold in China would bring further economies of scale and likely bring down prices of the devices that will work perfectly on Clearwire's network. Second, I don't see how China Mobile makes and announces this collaboration with Clearwire unless it is pretty certain that Clearwire will get the needed funding to upgrade to TD LTE. This has been one of the major concerns that others have with Clearwire--that they'll run out of money. I recognize that nothing has been officially announced, but I don't see this type of arrangement going forward without a strong likelihood (near certainty) that there is funding. Third, if TD LTE infrastructure and corresponding devices can be taken seriously in the US, can Clearwire maybe keep going on its own? While a buyout could be a nice boost to the share price immediately, there is enormous potential (and spectrum) that Clearwire can take nice advantage of if it can thwart any buyouts and continue as a going concern. I recognize that this announcement does not guarantee any of this. I think it is but one more piece of positive news that strengthens my own commitment as a CLWR shareholder. I think the near future is potentially bright, and the longer-term future (in the event there is not a buyout) is even looking brighter. Link to comment Share on other sites More sharing options...
JHelg Posted September 15, 2011 Share Posted September 15, 2011 Not so fast. If anything, the announcement adds more uncertainty to the matter at hand: China Mobile is the ONLY mobile operator globally to peruse TD-LTE, a 4G technology CHL itself helped develop. All North America operators use FDD-LTE, the mainstream LTE technology. Chances are Sprint will go down that road when they deploy 4G, as well. I didn't see anything about cash changing hands. The reality is that CLWR needs cash. Desperately. As I understand it, CLWR has already expressed an intention of going with TD LTE. From their press release: "Our LTE implementation plan, which is subject to additional funding, contemplates deploying Time Division Duplex (TDD) LTE technology and reusing our flexible all-IP network architecture as well as upgrading base station radios and some core network elements (which means we can save a lot of money on capital expenses). This will include the use of multicarrier, or multichannel, wideband radios that will be carrier aggregation capable. Carrier aggregation is a key feature of LTE Advanced that will enable us to further leverage our vast spectrum depth to create larger “fat pipes” for deploying mobile broadband service." Also, please see my last post and the article from Fierce Broadband Wireless, that I linked to, which states: "...Clearwire will roll out the time-division duplexing version, TDD LTE (also referred to as TD LTE), the adoption of which has been initially driven by mobile operators in China and India; but interest is quickly spreading beyond emerging markets, as shown by the fact that three of the five steering committee members of Global TD-LTE Initiative (GTI) are Clearwire, Softbank and Vodafone, all from developed markets with strong FDD commitments (the other two steering committee members are China Mobile and Airtel)." Link to comment Share on other sites More sharing options...
brker_guy Posted September 15, 2011 Share Posted September 15, 2011 If they come out with an iPad 2 on Sprint running 4G, whose network do you think they will be using? http://news.cnet.com/8301-1035_3-20106099-94/sprint-to-get-its-own-ipad-2-report-says/?tag=topTechContentWrap;editorPicks Oh, it gets better. The FCC wants more testing by LightSquared before they make a decision. Looks like someone at the FCC actually do work for live. :) http://connectedplanetonline.com/3g4g/news/FCC-wants-more-testing-of-LightSquareds-network-0914/ http://transition.fcc.gov/Daily_Releases/Daily_Business/2011/db0913/DA-11-1537A1.pdf http://tmfassociates.com/blog/2011/09/12/testing-123-testing/ Yep, things are definitely looking up for CLWR, but Mr. Market is sure not seeing it... Link to comment Share on other sites More sharing options...
bmichaud Posted September 15, 2011 Author Share Posted September 15, 2011 Let's not forget to mention the global 2.5 ghz initiative by Clearwire & China Mobile as confirmed by yesterday's announcement: http://www.marketwatch.com/story/china-mobile-and-clearwire-announce-collaboration-on-td-lte-devices-2011-09-14-15000 Not quite sure how this type of investment aligns with Mr. Long's "bot" strategy...maybe we should ask him.... Link to comment Share on other sites More sharing options...
JHelg Posted September 15, 2011 Share Posted September 15, 2011 Not quite sure how this type of investment aligns with Mr. Long's "bot" strategy...maybe we should ask him.... I don't understand. Can you explain? Link to comment Share on other sites More sharing options...
bmichaud Posted September 15, 2011 Author Share Posted September 15, 2011 Not quite sure how this type of investment aligns with Mr. Long's "bot" strategy...maybe we should ask him.... I don't understand. Can you explain? See the discussion here initiated by Harry Long - http://www.cornerofberkshireandfairfax.ca/forum/index.php?topic=5127.0 Link to comment Share on other sites More sharing options...
JHelg Posted September 15, 2011 Share Posted September 15, 2011 See the discussion here initiated by Harry Long - http://www.cornerofberkshireandfairfax.ca/forum/index.php?topic=5127.0 Got it. Thanks. Link to comment Share on other sites More sharing options...
S2S Posted September 15, 2011 Share Posted September 15, 2011 As I understand it, CLWR has already expressed an intention of going with TD LTE. From their press release: I was referring to a Sprint's 4G rollout on the spectrum it owns directly (or for that matter, should Sprint partner with MSOs or T-Mo, both of which have AWS bands) - the FDD-LTE standard would be a natural fit. The same way TD-LTE is a natural fit for CLWR's 2.5GHz band. Per CLWR/CHL, yes, roaming between the two standards is possible. But it only adds complications / retrofitting costs to a potential marriage between S and CLWR. Second, I don't see how China Mobile makes and announces this collaboration with Clearwire unless it is pretty certain that Clearwire will get the needed funding to upgrade to TD LTE. This has been one of the major concerns that others have with Clearwire--that they'll run out of money. I recognize that nothing has been officially announced, but I don't see this type of arrangement going forward without a strong likelihood (near certainty) that there is funding. That's a reasonable line of thought. I would, however, contest that if you were to apply the same logic to the Sprint and Lightsquared linkup, you would reach the conclusion that Sprint must have thought that (a) Lightsquared would soon find financing and (b) a L2 rollout would not interfere with existing GPS infrastructures. Wait, may be not. Link to comment Share on other sites More sharing options...
JHelg Posted September 15, 2011 Share Posted September 15, 2011 I would, however, contest that if you were to apply the same logic to the Sprint and Lightsquared linkup, you would reach the conclusion that Sprint must have thought that (a) Lightsquared would soon find financing and (b) a L2 rollout would not interfere with existing GPS infrastructures Let's just say that ever since I started digging into this thing, Lightsquared never inspired much of my confidence. I'm much more inspired by Clearwire's relationship with China Mobile. As an aside the Lightsquared fiasco keeps getting bigger and bigger. Today: Now the Pentagon has been raising concerns about a new wireless project by a satellite broadband company in Virginia called LightSquared, whose majority owner is an investment fund run by Democratic donor Philip Falcone. According to officials familiar with the situation, Shelton’s prepared testimony was leaked in advance to the company. And the White House asked the general to alter the testimony to add two points: that the general supported the White House policy to add more broadband for commercial use; and that the Pentagon would try to resolve the questions around LightSquared with testing in just 90 days. Shelton chafed at the intervention, which seemed to soften the Pentagon’s position and might be viewed as helping the company as it tries to get the project launched, officials said. http://nation.foxnews.com/lightsquared/2011/09/15/daily-beast-bombshell-general-accused-wh-pressuring-him-change-testimony-democratic-donor Is Lightsquared the next Solyndra? Link to comment Share on other sites More sharing options...
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