Sprint Reduces Clearwire Voting Stake

On June 1, 2011, Sprint Nextel Corporation notified Clearwire Corporation of its decision to voluntarily surrender Class B voting shares in Clearwire, to reduce its voting interest in Clearwire from approximately 54 percent to approximately 49.8 percent.

Sprint retains its 54 percent ownership of Clearwire, but the voluntarily reduction of voting shares protects Sprint in case Clearwire declares bankruptcy.

The latest move by Sprint illustrates the odd nature of the relationship an strategy, the ultimate wisdom of which is something it will take some years to assess with any certainty. One can argue in retrospect that pooling Sprint's spectrum with Clearwire's assets to create the expanded company was a rational effort to achieve a several year lead in fourth generation services. One also can argue that the move, which ceded managerial control even as Sprint gained 54 percent of the ownership rights, was a mistake.

One can argue it was a reasonable effort to steal a lead in the 4G market, which now looks to be less significant only because the strategy provided only about a two-year lead, and less than that in strategic terms, given the early choice of WiMAX as the air interface, given the rest of the industry's selection of Long Term Evolution as the 4G air interface.

Hindsight is perfect, of course.

http://www.sec.gov/Archives/edgar/data/1442505/000095012311057433/v59385e8vk.htm