Analyst: FiberTower backhaul deal helping DragonWave cut Clearwire strings

A deal to provide equipment for FiberTower's 24 GHz and 39 GHz packet backhaul networks is helping DragonWave move on as its Clearwire (Nasdaq: CLWR) business struggles, a Jefferies & Co. analyst said in a note to clients.

"We believe FiberTower (a new incarnation of former LMDS access companies First Avenue Networks and Teligent) will likely spend 75 percent of its future backhaul spending on microwave (rather than fiber) and think the benefit to DragonWave could be more than $1 million per quarter in the future, providing a 5 percent to 10 percent boost to its non-Clearwire revenues," said Jefferies analyst Peter Misek in the note.

DragonWave needed something to bolster its coffers as Clearwire pulled back on an aggressive rollout schedule. FiberTower, on the other hand, is seeing more business backhauling 3G and 4G traffic for major mobile carriers.

In a related comment, Misek also said that he expects AT&T's (NYSE: T) acquisition of T-Mobile USA could be the final straw that forces a Sprint (NYSE: S)-Clearwire deal, which, in turn could be a benefit to DragonWave.

For more:
- International Business Times has this story

Related articles:
Investors jittery over DragonWave's customer prospects
Clearwire-dependent DragonWave watches business erode

Suggested Articles

The third-quarter earnings season is underway and FierceVideo is tracking the results.

As for content, audiences have primarily tuned into entertainment and news programming.

The Diffusion Group reported that more than half of U.S. broadband households will live without an MVPD service by 2025.