NEW YORK (Reuters) - Sprint Nextel Corp. and Clearwire Corp. plan to build a U.S. nationwide mobile broadband network using WiMAX technology that will be five times faster than current wireless networks and cost less.
The announcement by the two companies on Thursday sent shares of Clearwire, which was founded by wireless pioneer Craig McCaw, up 32 percent. Sprint shares rose 1.5 percent.

The two companies will build their respective portions of the network, but enable roaming between their territories.

Sprint said it aims to make the network available to about 185 million people, including 75 percent of the people located in the 50 largest markets, while Clearwire will focus on areas covering about 115 million people.

Sprint expects to begin the initial stage of its construction by the end of 2007 and both companies expect to launch commercial service in the first half of 2008.

Sprint has said it expected to invest up to $800 million in 2007 and between $1.5 billion and $2 billion in 2008 relating to the WiMAX network. It did not say if the Clearwire agreement would change its spending plans.

Clearwire and Sprint Nextel said they do not expect any material exchange of cash between the companies.

Clearwire offers Internet access speeds of about 1.5 megabits per second on its wireless data network, which is faster than typical wireless networks.

However, Clearwire's Internet speeds pale in comparison to wired broadband. Major U.S. cable operators typically offer speeds of about 5 megabits per second or higher.

Clearwire shares jumped to $32.87 in early trade on Nasdaq. That is higher than the stock's highest previous level, which was reached on the day of its initial public offering in March.

Sprint shares edged higher, rising 36 cents to $22.52 on the New York Stock Exchange.

(Reporting by Franklin Paul, additional reporting by Martinne Geller in New York and Jennifer Robin Raj in Bangalore)
© Copyright 2007 Reuters.

Photo:
A Sprint logo on the front door of a Sprint store on New York City's West 42nd street December 13, 2004. Sprint Nextel Corp. and Clearwire Corp. plan to build a U.S. nationwide mobile broadband network using WiMAX technology that will be five times faster than current wireless networks and cost less. REUTERS/Mike Segar