FiberTower (Nasdaq: FTWR), an alternative wireless backhaul service provider, is losing even more business from struggling WiMAX provider Clearwire (Nasdaq: CLWR), which has terminated its backhaul service effective April 30, 2011.
Representing about $434,000 in monthly service revenue for FiberTower, Clearwire will have to pay about $1.9 million in early termination fees.
Previously, Clearwire paid FiberTower about $1.5 million associated with services it cancelled in February.
As reported in FierceTelecom's sister publication FierceBroadbandWireless, Clearwire has been cutting costs as it searches for more funding.
Although the loss of Clearwire is a blow to FiberTower, it previously said it was preparing for this move and that it would not have a major impact on its financial state in 2011.
"The company reaffirms that it believes that it has sufficient liquidity to support its business through 2011 and remains focused on prudent management of its cash balance and capital outlays, and continues to explore alternatives to position the company to participate on a larger scale in the growth of wireless backhaul," FiberTower state in a release.
FiberTower initially gained notoriety in the burgeoning wireless backhaul market in 2007 when it struck a deal to backhaul Sprint's (NYSE: S) WiMAX services. Outside of Sprint and Clearwire, FiberTower was one of several providers who were tapped by Verizon Wireless for wireless backhaul services for its ongoing LTE wireless roll out outside of their traditional ILEC wireline footprint in 2010.
For more:
- see the release
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