The Federal Communications Commission (FCC) has given its approval to the planned merger between Sprint Nextel and Clearwire Corporation, opening the door for a new US WiMax network.

Both companies will now form a new organisation carrying Clearwire's name to bring WiMax networks to cities across the US.

The new entity will be 51 per cent owned by Sprint, and 27 per cent by Clearwire. The remaining 22 per cent will be split between Google, Intel, Comcast, Time Warner and Bright House Networks, which have paid billions for their stakes.

"The FCC conditioned its approval of this transaction on Sprint Nextel's compliance with a voluntary commitment to phase out its requests for federal high-cost universal service support over a five-year transition period and with a voluntary commitment to use counties for measuring compliance with the Commission's wireless E911 location accuracy rules governing handset-based technologies," the FCC said in its ruling.

The FCC voted 5-0 to approve the plans, despite objections from AT&T which was trying to block the deal. AT&T has one of the largest 3G networks in the US.