Verizon Wireless’ Spectrum Acquisition Already Causing Industry Chain Reaction
As we reported earlier, Comcast, Time Warner Cable, and Bright House Networks were the trio that formed SpectrumCo, and the sale of that group’s spectrum to Verizon opened up the possibility of various deals between those entities.
As a result, Comcast and Time Warner Cable are kicking Clearwire 4G to the curb. The two cable operators will stop offering Clearwire 4G service as part of their service bundles within the next 6 months. Comcast, for its part, will start bundling its offerings with Verizon Wireless services instead, according to a Computerworld report. (Within months, Comcast will be testing four markets with the new Verizon option.)
The above is very bad news for Clearwire, which is a company that is now left with one big customer in Sprint Nextel--and that relationships is starting to look a bit like one between a cash-strapped kid and his rich, impatient uncle. Further, although Clearwire has previously announced that it was going to revamp its networks using LTE 4G technology and essentially abandon WiMax 4G (which is a sign that WiMax is done for in general), such a conversion just isn’t cheap or easy. Losing customers to a competitor like Verizon won’t exactly improve cash flow.
That leaves Clearwire in a bad spot with Uncle Sprint, and Sprint surely isn’t happy about where that puts it compared to its competitor Verizon. While Verizon continues to aggressively deploy LTE all over the country, Sprint’s 4G future is in large part tied to a company that is having money problems and is in the midst of trying to convert its existing technology to LTE.
Of course, these changes are all dependent on FCC approval of the Verizon spectrum acquisition--you never know, the government agency could put the kibosh on the whole thing.