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WW Associates Presents

WW Associates Presents. 2.5 Ghz Marketplace Awards & Analyses NIA 2005 February 16. 2003 BRS Collectors Award. Nextel – Fleet afoot Bankruptcy Purchases $145 Mil for what cost WorldCom $1 Bil $51 Mil for Nucentrix Gained major rights in about 100 M Pops

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WW Associates Presents

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  1. WW Associates Presents 2.5 Ghz Marketplace Awards & Analyses NIA 2005 February 16

  2. 2003 BRS Collectors Award Nextel – Fleet afoot Bankruptcy Purchases • $145 Mil for what cost WorldCom $1 Bil • $51 Mil for Nucentrix • Gained major rights in about 100 M Pops • Rejected many EBS & BRS leases in each

  3. 2003 Stealth Dealmaker Award Flux Fixed Wireless • Form D SEC filing lists 2 shareholders • 1 to a New Yorker for $6.3 M in shares • 1 to a Texan entity for $7.5 mil in shares • Speculation - HITN based in New York and Dallas home of original Clearwire

  4. 2004 BRS Collectors Award Fixed Wireless Holdings dba Clearwire • 25 deals per FCC weekly transfer releases • 153 call signs/309 channels/1555 BRS MHz • Cover 58 markets including 25 BTA holdings • F blocks in Atlanta & Seattle • Remainder primarily tertiary markets • Raises $160 M in August Private Placement

  5. 2004 Defenders Cup Award Nextel bolsters its positions in large markets: • Philadelphia F block • Dallas & Ft Worth E blocks both acquired • Austin E&F blocks each acquired • Washington H channel added • Also a few bundled and other licenses

  6. 2004 Big Market Player Award Nextwave Telecom buys from IP Wireless • Las Vegas 4 BRS channels for $2.25 M • Archdiocese of NY lease rights $12.7 M Nextwave Telecom to pay Archdiocese NY: • $1 Mil upfront plus $1.5 mil transition costs • $2.2-3.6 M rent/royalty/yr for 15 years NPV about $.10/MHz/Pop in each deal

  7. 2005 Sprinters Award • 28 market De Facto Lease deal with Sprint • Small Upper Midwest & West Markets • Clearwire extends 2ndary market position

  8. What all this activity mean • Last 2 years great “Buyer’s Market” • Bells only feigned interest in 2003 fire sales • Clearwire only game in many small towns • Nextwave 1 toe in 2 big markets as wholesaler • “Sprint Nextel will have the capability to deploy new services on the two companies’ 2.5GHz combined spectrum holdings that together cover 85 percent of the households in the top 100 markets.” (merger release)

  9. On Sprint -Nextel: “…this time around MMDS is hotter property, and there may be new opposition to its concentration…” 1/20/05 Wireless Merger Reviews On 2.5 Ghz rebanding: “Bells and cable lose if duoply upset by third pipe to home” 2/7/05 Cheat Sheets + Recent Legg Mason Analyses

  10. + AT&T Labs Slide at WCAI • In U.S., 2.6 GHz and 700 MHz are of key importance • Licensed spectrum is clearly important for ultra-reliable operation, esp. for mission critical use • WiMAX ForumTM certification profiles needed • Unlicensed operation is likely to be a powerful force in future: • Unlicensed operation key factor in popularity of 802.11 • Shortage of licensed spectrum

  11. + Sprint Nextel Transfer Filing • Wireless Interactive Multimedia Services • 2-4 Mpbs to fixed and portable devices • VOD, games, bus work, on site conferences • Fingerprint ID, Bio Scanning, Crime locale • Average 33 MHz licensed BRS per market • Average 56 MHz leased EBS-BRS/market

  12. EBS holds key to • Creating a “Lessor’s” market • Has most of today’s independent spectrum • Cable Consortium is reviewing its options • Integrated Providers interest in metro hubs • Increasing universe to “Tipping Point”

  13. Know your Contract • Technology usage restrictions • Past, present or future expiration date • Be cognizant of any holdover rights granted • Make your availability known as able

  14. Size Matters Density Counts Pop Growth Rates Enterprise Values Landscape Changes Top 3, 10, 30, 50 More demand/supply Future value premium Big Business Centers Intra/inter mkt alliance Consider Market Demographics

  15. Act Based on Own EBS Portfolio

  16. Fair Market Value Point of indifference between a willing buyer and a seller. A concession by either side can get a deal done. A bird in the hand worth two in bush

  17. Article Headline: “Valuing MCI in an Industry Awash in Questions” S&P analyst Tagline: “The price tag depends on who the buyer is” NY Times Feb 8th

  18. Take-away Comments • Have more than one party to negotiate • BLS/FON-NXTL may bid up in metros • Three bidders can create hockey stick effect • Bulls and bears get rich, holdouts can starve • Incumbents may pre-empt seismic change • New entrants may only pay more initially

  19. Ask WW Jim Wiesenberg jwiesenberg@cox.net 602.690.4929

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