Clearwire 2009 Annual Report Download - page 58

CLEARWIRE CORPORATION AND
S
UB
S
IDIARIE
S
MANAGEMENT’
S
DI
S
CU
SS
ION AND ANALY
S
I
S
OF FINANCIAL CONDITION
AND RE
SU
LT
SO
F
O
PERATI
O
N
S
ITEM 7.
M
anagement’s Discussion and Analysis of Financial Condition and Results of Operations
The
f
ollowing discussion and analysis should be read in con
j
unction with our consolidated
f
inancia
l
s
tatements an
d
re
l
ate
d
notes inc
l
u
d
e
d
e
l
sew
h
ere in t
h
is
f
i
l
ing. T
h
e
f
o
ll
owing
d
iscussion an
d
ana
l
ysis contain
s
f
orwar
d
-
l
oo
k
ing statements t
h
at ref
l
ect our p
l
ans, estimates an
db
e
l
iefs. Our actua
l
resu
l
ts cou
ld d
iffer materia
ll
y
f
rom those discussed in the
f
orward-looking statements. Factors that could cause or contribute to these di
ff
erence
s
i
nclude those discussed below and elsewhere in this Annual Report on Form 10-K, particularl
y
in the sectio
n
e
ntit
l
e
d
“Ri
sk
Factor
s
.”
F
orward-Lookin
gS
tatement
s
Statements an
di
n
f
ormat
i
on
i
nc
l
u
d
e
di
nt
hi
s Annua
l
Report on Form 10-K t
h
at are not pure
ly hi
stor
i
ca
l
are
forward-lookin
g
statements within the “safe harbor” provisions of the Private Securities Liti
g
ation Reform Act o
f
1
99
5.
Forwar
d
-
l
oo
ki
ng statements
i
nt
hi
s Annua
l
Report on Form 10-K represent our
b
e
li
e
f
s, pro
j
ect
i
ons an
d
p
re
di
ct
i
ons a
b
out
f
uture events. T
h
ese statements are necessar
ily
su
bj
ect
i
ve an
di
nvo
l
ve
k
nown an
d
un
k
nown r
i
s
k
s,
uncertainties and other im
p
ortant factors that could cause our actual results,
p
erformance or achievements, o
r
i
ndustry results, to differ materially from any future results, performance or achievement described in or implied b
y
s
uc
h
statements. Actua
l
resu
l
ts ma
y diff
er mater
i
a
lly f
rom t
h
e expecte
d
resu
l
ts
d
escr
ib
e
di
n our
f
orwar
d
-
l
oo
ki
n
g
s
tatements, includin
g
with respect to the correct measurement and identification of factors affectin
g
our business o
r
t
he extent of their likely impact, the accuracy and completeness of publicly available information relating to the
f
actors upon w
hi
c
h
our
b
us
i
ness strate
gy i
s
b
ase
d
or t
h
e success o
f
our
b
us
i
ness.
When used in this re
p
ort, the words “believe,” “ex
p
ect,” “antici
p
ate,” “intend,” “estimate,” “evaluate,
”
“
opinion,” “may,” “could,” “future,” “potential,” “probable,” “if,” “will” and similar expressions generally identif
y
f
orwar
d
-
l
oo
ki
ng statements
.
Recent Develo
p
ments and
O
verv
i
e
w
As of December 31, 2009, we operated in
6
1 markets in the United States and Europe, coverin
g
an estimate
d
44.7 million people. We had approximatel
y
642,000 retail and 46,000 wholesale subscribers as of December 31,
2009. We are the first mobile broadband service
p
rovider to launch a 4G mobile broadband network in the United
S
tates based on the 802.1
6
e standard
,
which we refer to as mobile WiMAX. The mobile WiMAX standard
facilitates fourth
g
eneration wireless services, which are commonl
y
referred to in the wireless industr
y
as 4G mobile
broadband services. We o
p
erated 4G mobile broadband networks in 27 of our markets in the United States as o
f
D
ecember 31, 2009, covering an estimated population of 34.5 million people. These markets include, among others
,
A
tlanta, Baltimore, Charlotte, Chica
g
o, Dallas, Honolulu, Las Ve
g
as, Philadelphia, Portland, Ore
g
on, San Antonio,
and Seattle
.
As of December 31, 2009, our other 34 markets continued to operate with a le
g
ac
y
network technolo
gy
.Ou
r
l
egacy networ
k
tec
h
no
l
ogy
i
s
b
ase
d
on a propr
i
etary set o
f
tec
h
n
i
ca
l
stan
d
ar
d
so
ff
ere
db
yasu
b
s
idi
ary o
f
Motoro
l
a.
This pre-4G technolo
gy
offers hi
g
her broadband speeds than traditional wireless carriers, but lacks the mobil
e
functionalit
y
of our current 4G technolo
gy
. In 2009, we converted 16 of our le
g
ac
y
markets in the United States t
o
4G mobile broadband under the CLEAR
TM
R
b
ran
d
,an
d
we
i
nten
d
to upgra
d
et
h
ema
j
or
i
ty o
f
our rema
i
n
i
ng
l
egac
y
markets in the United States to 4G technolo
gy
over the next
y
ear
.
D
urin
g
November 2009, we entered into a
g
reements to raise a total of $4.336 billion, which included a
$
1.564 billion equity investment from the Participating Equityholders and gross proceeds of
$
2.772 billion from a
d
e
b
t
i
ssuance. T
h
e
d
e
b
t
i
ssuance a
ll
owe
d
us to ret
i
re our ex
i
st
i
n
gi
n
d
e
b
te
d
ness un
d
er our Sen
i
or Term Loan Fac
ili
t
y
and extend our debt maturit
y
into 2015. We intend to use the net proceeds of this new financin
g
to continue th
e
ex
p
ansion of our 4G mobile broadband networks. Our current
p
lan is to ex
p
and our 4G mobile broadband networks
48