Cable Confronts Its Wireless Shortcomings

Carl Weinschenk

Perhaps the most often cited shortcoming of the cable industry's collective business plan is that it lacks a meaningful wireless component. In big and small ways, the industry confronted that old bugaboo in a trio of moves this month.


The most news was generated by the consummation of the long envisioned WiMax marriage of Sprint and Clearwire. Cable players have a minority but significant role: Comcast, Time Warner and Bright House each have a small piece of the deal.


The other deal announcement is flashier than that junior partnership arrangement. Cablevision said that it will create a Wi-Fi network over its prime New York/Connecticut service area. A public Wi-Fi network aimed to serve the Long Island chunk of that footprint is in trouble, which may have played some role in Cablevision's decision. Cable Digital News says the operator will provide free access to its broadband subscribers and invite others on for a fee. The network will cost $70 per home passed to build and offer speeds as high as 1.5 Mbps. Eventually, executives say, the network will be voice-capable.


Finally, Cogeco Cable, which claims to be the second-largest operator in Quebec and Portugal in terms of basic subscribers, said on Wednesday that it had launched its Quebec Wi-Fi service in Trois-Rivieres, Quebec. The service is free to Cogeco broadband subscribers and available for $5 for a two-hour session.


This MediaPost blog posting, published a few days before announcement of the Sprint/Clearwire deal, is prescient. The theme is that the industry's "nagging absence of a wireless strategy" could turn into an Achilles' heel. On one hand, wireless services are extremely popular and growing more so. On the other, people like bundled services that save them money. The bottom line is that it is unwise not to have a wireless product.


The cable industry certainly has more wireless tricks up its sleeve. This piece at GigaOm provides interesting tidbits. Vulcan Ventures won a B-block license at the recent 700 MHz auction. Vulcan is owned by Microsoft co-founder Paul Allen, who also owns Charter Communications. The piece also says that Comcast Wireless spent $304 million on 14 Block A and B licenses and already has awarded an equipment contract to Huawei. The company hired the CTO of Telefonica O2 Europe as senior vice president of wireless and technology strategy.


The era of standalone products is passing. Most subscribers have two, three or four services from the same company. Cable operators are a lot of things, but dumb isn't one of them. It is inevitable that the industry will make a significant play in the wireless sector. What remains to be seen is whether it is a defensive "me-too" effort aimed at negating the issue or an aggressive initiative design to proactively seek out converts.

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