Sprint, Cable Firms Join in 20-Year Deal
In an effort to put its service in front of more customers in an increasingly competitive and consolidated market, Sprint is turning to the nation's cable operators. The company announced Wednesday that it had reached agreements with four of the largest cable providers to form a joint venture to converge television and wireless technologies.
Comcast, Cox Communications, Time Warner Cable, and Advance/Newhouse Communications are the four cable companies involved in the deal.
Altogether, $200 million has been pledged to the initiative, with $100 million from Sprint Nextel and the other $100 million coming collectively from the cable operators. The money would be used to develop the service, as well as market and integrate it with the preexisting businesses of the five partners.
According to the terms of the deal, which expires in 2025, Sprint would receive exclusive rights to any technologies developed for three years.
The group is calling the service the "quadruple play," where the companies would be able to offer customers wireless voice and data, video, high-speed Internet, and cable phone service on a single bill.
"We have always believed cable provided the best available entertainment and communications experience, and by teaming up with other leaders of our industry, we will now take that competitive advantage to the next level," Comcast chairman and CEO Brian Roberts said.
The co-branded wireless phones offered through the joint venture would integrate cable and wireless services onto a single device. For example, a user would be able to program his home cable box to record programs through the mobile phone.
"It is about developing a wireless platform that connects all of our services for the customer both inside their home and when they are on the road," explained Time Warner chairman and CEO Glenn Britt.
Other features of the service would include a single voice mailbox for both the cell phone and home, unlimited calling between the mobile and home phone, and access to cable content from wireless devices. All services would take advantage of Sprint's new EV-DO network, which it formally rolled out on Monday.
The phones would be marketed at Sprint's 1,600 retail stores, as well as cable retail outlets and third-party distributors. Through Sprint's deal with RadioShack, the phones would also appear in thousands of locations across the retail chain, the companies said.