Tuesday, November 1, 2005

Sprint Nextel and Cable Partners Plan "Quadruple Play"

Sprint Nextel, Comcast, Time Warner Cable, Cox Communications and Advance/Newhouse Communications outlined their plans to form a joint venture to offer "Quadruple Play" services -- video entertainment, wireline voice, and wireless voice and high-speed data services.

$200 Million Commitment

The joint venture, which is mutually exclusive for three years and has a 20-year term, calls for a combined initial financial commitment of $200 million, $100 million of which will be committed by Sprint and $100 million of which will be committed collectively by the cable companies. The investment is expected to be used to fund the development of the converged services, national marketing initiatives and back office integration.

In each market, the price of the integrated offering will be agreed to by Sprint and the cable company serving that market. Each cable company will be responsible for billing customers and for customer service in its territory for the converged offering. Customers can enjoy the convenience of a single bill for all of their services, including video, data, phone and wireless.

Unlike MVNO (mobile virtual network operator) or other wholesale relationships, the companies participating in this joint venture will retain full economic benefits of the acquired customers, similar to what they currently enjoy through their direct retail channels.

The joint venture will market its converged services to the 41 million customers currently served by the cable companies as well as to Sprint's nearly 46 million wireless subscribers. The venture has the potential to serve approximately 75 million homes currently passed by the cable companies. The companies contemplate additional participation from other cable companies.

The five companies also agreed to explore potential next generation wireless technology business plans for new services that could be provided using Sprint's Broadband Radio Spectrum (2.5 GHz), with the goal of further integrating wireline and wireless services.

Beginning in 2006, the companies in the joint venture plan to:

  • Offer consumers access to the expanded four element bundle, or "Quadruple Play," or any combination of services including video, wireless voice and data services, high speed Internet and cable phone service.

  • Serve growing consumer demand for a wireless "third screen" beyond the TV and computer screens.

  • Develop and introduce new co-branded wireless devices that will provide new and unique features that integrate cable and wireless services all on a single device.

  • Sell and market these co-branded products and services to customers through a combination of 1,600 Sprint retail stores, cable retail outlets and other third-party distributors, including thousands of RadioShack stores.

Gary Forsee, president and CEO of Sprint Nextel said, "The new Sprint-cable partnerships will forever transform what used to be merely a cell phone into an indispensable third screen in customers' lives."

Brian Roberts, chairman and CEO of Comcast said, "This agreement, which represents the most expansive technological convergence of its kind, will deliver to our customers an unprecedented level of real-time, high-speed mobility and access to content all in a single package.

Jim Robbins, president and CEO of Cox Communications said, "This revolutionary partnership will forever change the way Americans consume entertainment, communicate and exchange information."

An interactive demo is online.

See also