The next round in the cable/telco wars
It's not a done deal yet, but the Wall Street Journal (11/25/05) reports that a group of cable TV operators are working on an agreement with Sprint Nextel Corp. to allow the cable companies to offer cellphone service as part of their package of TV, Internet, and landline telephone offerings. Among the companies involved on the cable side are the three leading companies: Comcast, Time-Warner Cable, and Cox.
This move is a direct challenge to the big phone companies (SBC, Verizon, Bell South) who are definitely moving into the television connection space, both through alliances with satellite services and soon through phone lines. Those Baby Bells have also extended their cellphone holdings.
And there's more, according to the WSJ article (" Cable Firms Near Pact With Sprint"):
As part of the deal with Sprint, the cable operators will also have the ability to use a collection of wireless radio wave spectrum owned by Sprint, according to the people familiar with the talks. That way, cable operators will be able to offer wireless broadband service to their cable-modem subscribers on their laptops even when they aren't at home. The spectrum has been the subject of much speculation since Sprint and Nextel Communications Inc. merged this year, as it brought together a nearly nationwide collection of unused, valuable airwaves.
This rapid shift in the competition matrix promises to make for a heated struggle between several very well-heeled companies that have, until now, enjoyed something of a local monopoly. Already the switch to VOIP is taking on critical mass. According to an Investors.com article ("Cable TV Companies Mull Wireless Plans", 10/24/05):
Time Warner Cable says it expects to have 1 million VoIP customers by year's end. Cablevision (CVC) had 478,000 VoIP customers as of June 30. And Comcast, just starting out, forecasts 250,000 subscriber's by year's end.
