Updated: Sprint Sued By Non-Profits Over Clearwire Lease For WiMax

Updated: Sprint Sued By Non-Profits Over Clearwire Lease For WiMax

Updated with Sprint’s response at 12:36PM – see below.

Mobile Citizen and Mobile Beacon two non-profit providers of internet access, filed a lawsuit today in the Suffolk Superior Court in Massachusetts claiming that Sprint’s plan to cut off its WiMax service would leave 300,000 people without internet access.

Mobile Citizen and Mobile Beacon provide low-cost internet access to 429 schools, 61 libraries, and 1,820 nonprofit organizations throughout the US, and are able to do so through a 30-year lease agreement they made with Clearwire. Sprint acquired Clearwire in 2013 and according to the lawsuit, hasn’t provided the non-profits with a means of transitioning on to a network that would allow them to continue providing service.

Sprint has been integrating Clearwire’s business into the company, but WiMax didn’t make the cut. The service is slated to end on November 6, which will force customers to find new options. However, new broadband options aren’t always available.

The lawsuit contends that Sprint has made it impossible for the entities to change over to the Sprint LTE network because it is throttling their internet service. Mobile Citizen and Mobile Beacon are asking the court to compel Sprint to come up with a plan to maintain the service agreement.

Mobile Citizen and Mobile Beacon are among the largest Educational Broadband Service (EBS) Providers in the United States. EBS refers to spectrum the Federal Communications Commission reserved to serve the public interest by providing wireless broadband services in support of education. The nonprofits that make up Mobile Citizen and Mobile Beacon leased a portion of their spectrum to Clearwire for 30 years in 2006 in exchange for the ability to provide unlimited, high-speed broadband service to schools, libraries and nonprofit organizations nationwide.

“Ours is one of the few programs available that not only serves students, but also low-income adults, seniors and the disabled,” said Katherine Messier, the managing director of Mobile Beacon in a statement. “We don’t believe providing a second-class internet service or ‘slow lane’ is an acceptable means to close the digital divide. We’re fighting to prevent diminished service to schools and poor people now — and over the remaining 21 years of our contract.”

Recently, Sprint opted to sit out the 600Mhz band spectrum auction to be held by the FCC in 2016. The spectrum auction would have provided access to low-band wireless spectrum which provides for cheaper coverage in rural areas and helps to make stronger in-building networks. The company picked up a fair amount of this spectrum with the Clearwire and Nextel acquisitions but is obviously shuttering certain aspects of those business lines. Sprint appears to be focusing on managing the spectrum it has, rather than adding more.  This court case could make that plan harder to execute. Watch this space.

We reached out to Sprint for comment on the case and will update this story if they respond.

The full complaint is available here.

Update:

Sprint spokeswoman Stephanie Vinge Walsh replied to us today with the following statement.

“Since April 2014, it has been known by both of these Sprint partners – Mobile Citizen and Mobile Beacon – that Sprint and its subsidiary Clearwire are in the process of transitioning broadband network technology from WiMAX to the more advanced and higher quality LTE. This is part of a massive and investment by Sprint to enhance and improve broadband service for consumers. To this end, Sprint has worked very proactively and diligently to transition all affected partners and customers. Sprint gave notice to these licensees in the summer of 2014 regarding the November 2015 decommissioning date — well over a year ago. And we have continuously publicized this date throughout 2015. In fact, we have already transitioned the vast majority of our other EBS licensee community to the new LTE network, and their users are already enjoying the benefits of the LTE network.

Like the vast majority of our other EBS licensee partners, Mobile Beacon and Mobile Citizen could have transitioned their end users to the new LTE network months ago. We have gone to great effort to work with the Mobile Beacon and Mobile Citizen to transition WiMAX accounts to LTE, but the transition cannot take place without the cooperation of the Licensees, and the recent conduct is not cooperative nor in the spirit of good faith. We have repeatedly made attempts to discuss with them how we can best meet their end users’ needs and resolve this matter. But instead of working it out like reasonable partners, they chose to file a complaint.”

We also asked for a response to the crux of the complaint which suggests that Sprint is throttling LTE service to both Mobile Beacon and Mobile Citizen. Ms. Walsh had this to say:

“We do not offer unlimited data-only service to any customer. Mobile Beacon and Mobile Citizen are using data-only devices. Yes, Sprint engages in reasonable network management practices as it is contractually entitled to do to ensure that their customers did not lose access in the middle of the month. Sprint does not have a retail relationship with Mobile Beacon and Mobile Citizen – they resell Sprint’s service to their own customers. We have repeatedly made attempts to discuss with them how we can best meet their end users’ needs and resolve this matter. But instead of working it out like reasonable partners, they chose to file a complaint.”

We will keep following the story as it progresses.