Sprint Nextel, cable operators in joint venture
Sprint Nextel and a consortium of cable companies announced a joint venture that will let them offer a “quad play” of integrated voice, video, data and wireless communications during the first half of next year.
Cable participants in the deal are Comcast, Time Warner Cable, Cox Communications and Advance/Newhouse Communications. However, the cable representatives are open to others in the industry joining their consortium; for example, Charter Communications is negotiating to become a member of the consortium.
“We’re eventually going to have a national quilt,” said Comcast Chairman and CEO Brian Roberts during a press conference.
The deal represents more than just simply placing four separate services on a single bill; rather, the services will be integrated, so customers will be able to control their cable digital video recorders and access messages — e-mail or voice mail — from their Sprint Power Vision EV-DO handsets. Customers also will be able to watch live cable TV programming.
“We’re not just adding a plain old wireless phone to a cable service,” said Time Warner Cable Chairman and CEO Glenn Britt during the press conference. “We’re tying these services together.”
While the joint venture is geared toward the consumer market, the capabilities it enables will be attractive to the business/enterprise market as well, said Steve Hilton, director of small and medium business (SMB) strategies for the Yankee Group. For instance, as more companies use digital cameras for video surveillance, being able to monitor them via a mobile phone is an attractive option. Mobile sales-force automation tools also would be compelling, he said.
“My belief is that consumer is a first step [but] there are bigger things on the horizon here,” Hilton said. “I think bundling already is a huge winner in the SMB space. I think the next stage of bundling is making sure that, when we add applications into the bundle, the graphical user interfaces and the interaction that the customer has is seamless and consistent across all product offerings.”
The companies will invest $200 million — $100 million from Sprint Nextel and $100 million from the cable consortium — to fund development.
