NextWave, From Spectrum to Hard Technology (WAVE)

By Douglas A. McIntyre Published Apr 24, 5:13AM EDT

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NextWave Wireless Inc. (NASDAQ: WAVE) may be unloading its held spectrum assets to focus on core technology offerings. Last night it announced that it has retained Deutsche Bank and UBS Investment Bank to explore the sale of "its extensive spectrum holdings in the United States."

The company noted that its spectrum footprint covers over 251 million people (pops) in the U.S. and includes major markets such as New York, Los Angeles, Chicago, San Francisco, Boston, Philadelphia, Denver, Houston, and Detroit. It also includes licenses and lease rights for a total of 4.7 billion MHz/pops of spectrum comprised of the following:

154 Advanced Wireless Service licenses in the 1.7/2.1 GHz band,
30 Wireless Communication Service licenses in the 2.3 GHz band,
and 39 Educational Broadband Service and Broadband Radio Service licenses and spectrum leases in the 2.5 GHz band.

The company said it has received multiple offers for its U.S. spectrum assets and this will allow it to strengthen the books, retire debt, and continue the commercialization of wireless broadband and multimedia solutions.

The products it wants to introduce are high-performance WiMAX and RFIC chipsets, advanced multi-mode, multi-band TD-CDMA, WiMAX and LTE enabled base station platforms, breakthrough MXtvTM and TDtvTM mobile television systems, mobile multimedia software solutions and platforms.

The last year has been tough for NextWave Wireless as shares closed at $4.75 yesterday, with a 52-week high of $10.44. After a brief look, the books are already in decent shape and that would signal the bulk of the funds would go toward commercializing their products rather than trying to own airwaves.

As its revenues are still minuscule this might actually work. Its market cap is $440 million and 2007 revenues were a low $59.1 million. The one analyst that follows it sees revenues to be some $123 million this year and $224 million next year, although we wouldn’t rely on that at all as it is one analyst.

But a spectrum sale also assumes their products are ready to go, are top notch, are well received, and that its already-signed partnerships come to rapid fruition. If not, then its just another technology company fighting in a crowded space.

Jon C. Ogg
April 24, 2008

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.