Cable TV groups in Sprint venture
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Four US cable companies, including industry leaders Comcast Corp and Time Warner Cable, have entered the fast-growing wireless arena through a joint venture with Sprint Nextel.
The deal, which will start in 2006 with the cross promotion of services to offer customers the so-called “quadruple play” of video, internet, phone and wireless access, involves a total initial investment of $200m.
“The cross marketing benefits are potentially significant,” said Craig Moffett, analyst at Sanford Bernstein. “The cable operators bring a combined 75m homes to whom they can market Sprint. Sprint brings 46m wireless subscribers.”
The group will aim to develop mobile phone products to enable customers to effectively take their e-mail, voicemail and TV services with them.
The establishment of this “third screen”, as the mobile phone is increasingly referred to, comes as communications and media companies race to offer their customers services available on their televisions and computers on mobile devices.
Talks between Sprint and the cable companies, which operate in geographic markets with little overlap, have been going on since last year.
Cable companies have also considered other options, such as acquisitions of wireless companies or acquiring spectrum to develop networks.
Among the services envisaged in the venture, cable customers will be able to watch programmes recorded on their digital video recorders (DVRs) on the new mobile phones.
In addition, they could programme their DVRs even when not at home.
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