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Cable Technology Feature Article

August 01, 2011

Time Warner Cable Sees Weak Demand for Wireless

By Gary Kim, Contributing Editor

Time Warner (News - Alert) Cable hasn't seen strong demand yet for quadruple play services including wireless. “Our results in terms of actual [wireless] customers so far are not terribly exciting,” Time Warner Cable CEO and Chairman Glenn Britt said during the company's quarterly conference call with investors.

“The evidence so far is that it's not a big market for the quadruple-play,” says Britt. Time Warner Cable is not completely certain whether the firm is “just not doing it right,” or whether the demand simply isn't there.

“We have this idea, and we’ve had it for some time, that bundling wireless broadband in with our other products to create a so called quadruple-play might be interesting to consumers,” said Britt. “The reason I say might is that we’re not sure and the marketing evidence is mixed.”

But the company also says it plans to test new bundles of wireline, Wi-Fi and wireless services. Cable's relative inability to establish a clear position in wireless is not for lack of some effort. Cable operators have purchased spectrum and worked with Sprint (News - Alert) for decades, in the wireless space, but nothing much has emerged, certainly nothing like the success cable has had with digital voice, broadband access or business services.

In 2005 four major cable operators created a joint venture with Sprint. Comcast (News - Alert), Time Warner, Cox and Advance/Newhouse partnered with Sprint Nextel to offer wireless services along with their cable TV, high-speed data service and landline telephony services. The cable operators put up a combined $100 million and Sprint matched the figure for the $200 million joint venture.

In 2006 the “SpectrumCo” consortium, consisting of Time Warner Cable, Comcast, Cox (News - Alert) Communications and Bright House Networks, bid some $2.4 billion for 137 wireless licenses as well.

Perhaps the only common thread is that wireless operates on “somebody else's network,” while all the other successful businesses cable operators have launched use the fixed-line network. Cable executives historically have been adamant about maintaining complete control of their own networks, and have resisted allowing other service providers to use those networks.

One can only speculate about why the wireless arena has been so apparently difficult for cable operators, compared to other new lines of business where cable operators have found significant success.

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Gary Kim (News - Alert) is a contributing editor for TMCnet. To read more of Gary’s articles, please visit his columnist page.

Edited by Jennifer Russell