• Fortune, Thursday, May 8, 2008 11:15 AM

The $3.2 billion WiMAX joint venture between Sprint, Clearwire, Comcast, Time Warner Cable, Intel and Google was nailed down on Wednesday, signaling a huge win for Sprint Nextel CEO Dan Hesse, who had directed considerable investment in a technology that had been deemed too expensive by some and even dead-in-the-water by others at a time when Sprint's stock was flagging. But in swept the likes of Clearwire and Intel, and later, Comcast, Google and Time Warner Cable, to save the project with their collective billions.

Even so, Fortune says the new joint venture landed "with a cold thud" when the companies announced that the project would start off with a "$2.3 billion funding gap." Translation: we're either going to have to scale this thing back or start a fundraising campaign, quick.

To be sure, the WiMAX plan is ambitious, covering 130 cites nationwide. It aims to deliver fast Web connections (faster than the 3G networks operated by AT&T) over a broader territory than Wi-Fi for $50 per month. That's the dream, Fortune says. The reality, at least so far for the likes of Clearwire and Sprint, has been a whole lot of red ink, which is why both companies were forced to frantically search for WiMAX partners. It's unclear where the other $2.3 billion is going to come from, if it comes at all. Banks certainly aren't lending that kind of money to money-losing ventures these days.

Read the whole story at Fortune »