WASHINGTON — If the $12-billion venture formed by Sprint Nextel and Clearwire this week works out, your cell phone may turn into a far more powerful, versatile and perhaps costlier device.
The new company, called Clearwire, wants its customers to be able to use mobile phones and laptops nearly anywhere in the country to watch movies while waiting for the bus, turn on Dancing with the Stars while waiting for the soccer game, surf the Web and hold video conferences on laptops while riding along the Interstate.
But don't cancel that home Internet service over cable or DSL just yet. Although the new wireless connection, called WiMax, should be much faster than what's available on today's cell phones, it won't be as fast or as reliable as the technology that brings cable television, Internet and phone service into houses from the street. And though it is being tested, expanded service is about two years away.
The companies aren't saying how much the service will cost. A few analysts estimate it at $40 to $60 a month. At first, at least, it would most likely be an extra rather than a substitute for the monthly phone, Internet and paid television services that cost many customers $150 to $200 a month.
Craig Mathias, an analyst at Farpoint Group, said the technology will be picked up first by business users who want to be able to access their office network from remote locations and send large e-mails over cell phones on the road.
Sprint sees WiMax as an opportunity to set out on a path toward recovery after a subscriber exodus and since its troubled merger with Nextel Communications in 2005.
Consumer advocates hope WiMax will help simplify various telecommunications and television subscription plans. Eventually, broadband wireless should allow consumers to cancel other subscription-based Internet and phone services, said Chris Murray, senior counsel of Consumers Union. Free Internet phone services like eBay's Skype, along with Web-based video, should be used over the network, he said.
"The reason we've always been excited by broadband via wireless is not because it gives consumers the possibility to do a lot of new nifty things, but because it has the possibility of saving people a lot of money," Murray said.
However, the many uncertainties that surround the technology make it unclear when that could occur. WiMax requires a complex and expensive technological infrastructure of cell towers and underlying fiber-optic systems that is expected to take at least two years to build before the service could be deployed to most areas of the United States.
The venture is backed by $3.2-million in investments by companies such as Google, Comcast, Time Warner and Intel.
Wireless pioneer Craig McCaw will continue to act as chairman of Clearwire, as will current CEO, Benjamin Wolff. The company will eventually go public in an initial public offering. Sprint will hold a majority stake of 51 percent in the company, Clearwire will own 27 percent and its investors will own a combined 22 percent.