Best Buy To Resell Clearwire’s Mobile Broadband

August 1st, 2010 | by Maddison Paltridge |

Now that Best Buy Co., Inc. (BBY) has made mobile a clear strategic priority for the largest consumer electronics retailer in the U.S., why not private label a broadband internet service and sell it? That’s precisely what Best Buy is doing with Clearwire Corporation (CLWR), as it is taking the latter’s 4G wireless nationwide network and branding its “Best Buy Connect” with that network.
This is good for Clearwire and the owner of much of that company, Sprint Nextel (S). Sprint Nextel is ahead of the curve when it comes to what is known as 4G wireless, with larger competitors Verizon Communications, Inc. (VZ) and AT&T (T) still in the midst pf preparing a 4G rollout across America that Clearwire/Sprint already has. Best Buy’s involvement in recruiting shoppers onto Clearwire’s 4G network will be a boon to the company and to Sprint’s efforts to add customers to the Clearwire network that way in addition to having smartphones on its wireless network that also work with Clearwire’s 4G network.

Sprint’s share price decline in the last three years from $18 to under $5 today has mostly been due to its losing valuable postpaid wireless customers to the competition for a litany of reasons. In all fairness, Sprint has cleaned up its act tremendously under CEO Dan Hesse, but is still hemorrhaging customers every quarter (although the bleeding has slowed way down from the quarters in 2009).

Imagine if all the laptops sold at retail Best Buy stores were offered with Clearwire 4G access built-in. Not only would that be a boon to Best Buy, but Sprint’s majority stake in Clearwire would feel just dandy in that arrangement. Then, perhaps, S shares would find themselves north of $10 for the first time in a long time. Care to add some S to your portfolio? Is Sprint on the upward trend for 2012?

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