As it opens its flagship trade show in Orlando, Florida Monday, The National Content & Technology Cooperative said it is closing in on landing a partnership agreement with a still undisclosed carrier or carriers for mobile service for its more than 700 member companies. 

NCTC first hinted at the deal last month. The agreement, expected to be similar to mobile virtual network operator (MVNO) deals struck between other cable and wireless service providers, would allow NCTC members to provide premium cell phone service to their customers at significant discounts by the fourth quarter.

In a press release, NCTC said that multiple suppliers will be incorporated into one program that is transparent to member subscribers.  

“Mobile is increasingly crucial to many of our members who are seeking more options to meet the unique needs of their customers,” NCTC VP of Technology Innovation Jared Baumann said in a press release. “Like other benefits of NCTC membership, our new MVNO agreements will harness our collective buying power to drive  value and ease of entry for members of all sizes. Now that NCTC is firmly in the mobile game, we can benefit operators and end-users across the country by offering the most competitive deals for high-quality services.”

Also: NCTC CEO Lou Borrelli Talks ‘Connectivity Exchange,’ MVNO Deals ... and the New Name

The new MVNO agreements will allow operators to bundle MVNO services with broadband and other options, according to NCTC.

“Success in today’s complex and competitive market hinges on collaboration,” Baumann said. “Our new MVNO agreements align perfectly with the other group-based savings members already receive. Based on this, operators will be able to offer innovative new bundles and service offerings to their customers.” ■

Altice USA said Thursday that it has expanded its existing MVNO deal with wireless carrier T-Mobile, but offered few details of the new agreement.

Altice had been one of the last remaining major cable operators to redo its mobile virtual network operator (MVNO) agreement with a carrier -- Comcast and Charter renegotiated their MVNO pacts with Verizon in 2020 and Dish reached a new MVNO deal with AT&T last year. At the Morgan Stanley Technology, Media & Telecom conference in San Francisco earlier this month, Altice USA CEO Dexter Goei said a new deal with T-Mobile was coming soon. 

On Altice USA’s Q4 conference call with analysts on February 16, Goei said that the company was on the “one-yard line” with T-Mobile regarding renegotiating the MVNO deal, adding that the revised agreement would offer Altice more flexibility and provide “financial incentives” to T-Mobile. 

In a press release, Altice USA said the terms of the new agreement “are mutually beneficial to both companies.”

Altice USA launched its mobile product in 2019, through an MVNO deal with Sprint. Sprint was purchased by T-Mobile in 2020. 

Altice USA is in the process of rebranding its mobile service as Optimum Mobile across both its Optimum and Suddenlink footprints.  As of Q4, Optimum Mobile had about 186,000 mobile lines. Comcast's Xfinity Mobile ended the year with about 4 million mobile lines and Charter closed out 2021 with about 3.6 million mobile lines.  

Also: For Cable Operators, Wireless Gets Real 

“As we continue to grow and evolve our Optimum Mobile service, we are pleased to reach a new agreement with T-Mobile that ensures our mobile customers will continue to benefit from T-Mobile’s nationwide network,”Altice USA EVP of consumer services Matt Marino said in a press release. “In addition to access to America’s largest 5G network, the agreement enables Optimum Mobile to provide more flexibility and value to our customers and, when coupled with our Optimum and Suddenlink broadband service, deliver a 360-degree seamless connectivity experience at home and on the go.”

Optimum Mobile currently offers three data plans -- 1 Gigabyte, 3 GB and Unlimited GB -- all with unlimited talk and text and delivered over the T-Mobile network. The services are aggressively priced -- Optimum Mobile’s 1GB plan is free (not including a $20 activation fee) for the first 12 months and $19 per month ($14 if an Optimum broadband customer) thereafter. The Unlimited GB plan is priced at $45 per month. 

"We are excited to extend and expand our Altice USA partnership on the T-Mobile network with fast and reliable service to Altice USA’s Optimum Mobile subscribers,” said T-Mobile wholesale SVP Daniel Thygesen in a press release. “By leveraging T-Mobile’s unparalleled network and platforms to serve Optimum Mobile subscribers, Altice USA remains the premier one-stop-shop for bundled mobile and broadband services for its subscribers."

While on the surface, Dish Network's new mobile virtual network operator (MVNO) deal with AT&T looks like many other similar agreements of the past few years, at least one analyst thinks the transaction is a game changer for the satellite TV company.

In a note to clients Monday, MoffettNathanson principal and senior analyst Craig Moffett noted that the AT&T deal will give Dish the ability to become a Mobile Network Operator/MVNO "indefinitely," potentially letting it off the hook for fulfilling its federally mandated requirements to provide wireless service to the rest of the country after 2023.

"The issue here is duration," Moffett wrote.

Dish has been laying the groundwork for its wireless service for years using its own spectrum and some from other sources -- in 2019 it agreed to buy wireless spectrum and the Boost Mobile prepaid business from T-Mobile for $5 billion -- for what it claims will be a state-of-the-art 5G service based on ORAN technology. The company said its first market will go live in Las Vegas in the third quarter. 

Although it already has an MVNO agreement with T-Mobile, part of the larger deal where Dish acquired about $3.6 billion in spectrum licenses and the Boost Mobile prepaid wireless business for $1.4 billion from the carrier, that resale agreement was set to expire in 2027. In addition, T-Mobile plans to shutter its 3G CDMA wireless business on Jan. 1, a move that Dish, which relies on that network for Boost Mobile, has said would be a financial hardship. 

According to the latest agreement, AT&T will make its network available to Dish for 10 years, with a two-year transition period, pushing the expiration date to 2033. In a research note, MoffettNathanson media analyst Craig Moffett wrote that is a key part of the deal, because until now it was becoming increasingly doubtful that Dish would be able to meet federally imposed deadlines on its wireless buildout. 

Dish is under the gun to make its network available to about 70% of the country by the end of 2025, but Moffett noted that was never really a concern.

“After all, the first 70% of the population lives on just 2.9% or so of the U.S. by landmass,” Moffett noted. “ It has always been what would come after that that mattered.”

Moffett wrote that table stakes for wireless coverage in the U.S. is about 95% of the country.

“Without an MVNO agreement to fall back on, Dish would have to build that out themselves by 2027, when the T-Mobile deal was slated to expire… and the next 25% of the country occupies nearly ten times the landmass of the first 70%,” Moffett wrote.

Moffett added that even if reaching 70% of the population with its network won’t be that hard, it depends on the definition of coverage -- does it  mean merely enough to meet minimum Federal Communications Commission requirements, or service that is sufficient enough to satisfy customers? 

“The latter definition of coverage is vastly more demanding than the first; it means fill-in facilities in every airport, stadium, convention center, and congested downtown area, and every dead spot along every highway,” Moffett wrote. “Under the T-Mobile agreement, Dish had until 2025 to satisfy the FCC, but only two more years afterwards to satisfy the much more exacting demands of customers. That was always the real challenge.”

While AT&T will reportedly receive $5 billion for its trouble, Moffett believes it has sacrificed its future competitive position for short-term wholesale revenue. Because the Dish deal is similar to the MVNO agreements Comcast and Charter have struck with Verizon, Dish will  be able to build out its own facilities in dense areas, which have a low cost and high return, and leave the low density areas, with higher costs and lower returns, to AT&T

“We can’t stress enough what a windfall this is for Dish.  And what a terrible decision it is for AT&T,” Moffett wrote, likening the deal to Orange’s 2016 decision to strike an attractive MVNO deal with MasMovil in Spain. “Today, five years later, MasMovil has taken double-digit market share, and Orange is shrinking by more than 10% annually.”

Moffett added that the AT&T deal doesn’t solve Dish’s CDMA problem because AT&T has never had a CDMA network. But that just proves the real impetus for the deal was in its duration. 

Not every analyst shares Moffett’s view.

In a research note Monday, JP Morgan media analyst Phil Cusick said that the general consensus among telecom execs is that they want to be the provider of choice when an MVNO moves into the market. Whether AT&T struck a deal with Dish or not, it wouldn’t change that situation. 

“...the negative to the industry came when Dish bought spectrum over the last 10 years, or when it agreed to replace Sprint, not today,” Cusick wrote.

Cusick, who downgraded Dish to “underweight” in June,  also wasn’t convinced the deal was that big a windfall for Dish.

“We don’t see this as a huge change for Dish’s prospects, but rather that getting a rural roaming deal and longer-term MVNO are each pieces of the puzzle that Dish needed in building a network over time,” Cusick wrote. “It is interesting that Dish shares were off as much as Verizon shares Monday, likely indicating that there was still some hope of Dish selling assets rather than building a network.” 

Dish shares were down about 1% (41 cents) on July 19 to $39.04 each. The stock closed at $40.87, up 4.7% on July 20.

Verizon shares were down 1.1% (62 cents) on July 19 to $55.84 per share. The stock closed at $55.62, down 0.4% (22 cents) on July 20.  

Some have speculated that the deal really is a precursor for a future combination with AT&T’s DirecTV satellite TV business. Moffett said that is probably unlikely, but in the end won’t matter that much, adding that addressing the 2027 expiration was more important than ensuring the future of the declining satellite business. 

Barclays Research analyst Kannan Venkateshwar wrote that there could be several reasons behind doing the deal for AT&T -- one he said, was to limit Dish’s capacity to invest in building out its network by spending big on the MVNO. 

“Strategically, the move is also interesting given that the expectation among some investors was likely the opposite i.e. that Dish would be a scaled MVNO service provider to others rather than being an MVNO user itself for the next decade,” Venkateshwar wrote. For AT&T, he said the additional money from the agreement will help provide another cash flow source to get to its goal of $20 billion in free cash flow after its WarnerMedia deal. 

But Moffett again pointed out that in giving Dish the breathing room it needs to meet its federal requirements and a network deal that virtually allows it to pick and choose where it can spend the most for the largest return, AT&T has basically breathed new life, wittingly or unwittingly, into Dish. 

“Again, the big takeaway here is that AT&T has all but assured Dish’s survival, and as a much more disruptive and dangerous competitor than would otherwise have been the case,” Moffett wrote. “AT&T has been signaling recently that they want more wholesale business when they can get it, so perhaps we shouldn’t be surprised. They clearly decided that the short term gain of additional wholesale revenue was worth that risk. But they’d be well advised to be careful what they wish for. We see their decision to extend this deal to Dish as a catastrophically bad one. Dish and its investors should thank their lucky stars for AT&T’s strategic blunder here.”

Less than five years after first launching the latest iteration of cable wireless service, the major operators have finally got it right, according to influential media analyst Craig Moffett. 

Moffett, principal and senior analyst at MoffettNathanson, makes his case In a 44-page report issued Thursday, adding that he believes that annual revenue at Comcast Xfinity Mobile, which launched in 2017, could reach $5.1 billion in sales (more than twice the $2.3 billion expected in 2021) by 2025. Moffett also expects Xfinity Mobile to have 7.9 million subscribers by 2025, nearly double the 3.9 million customers estimated for this year.

Moffett expects Charter Communications, which launched its Spectrum Mobile service in 2018 and shares an MVNO agreement with Comcast, to also aggressively price its wireless service. As a result, he estimated that Spectrum Mobile revenue will double from $2.1 billion in 2021 to $4.2 billion by 2025 and that subscribers will double from 3.5 million to 7.2 million in the same time frame.

“Cable wireless is now ready for its star turn,” Moffett wrote, adding that the product “offers the potential for significant value creation for the MSOs and their investors.”

That’s a far cry from 20 years ago, when cable first ventured into the wireless business with Sprint, the first of three failed attempts at a wireless product with that company. Now Sprint is no more -- it was purchased by T-Mobile in 2020 in a $26 billion deal  -- and Comcast and Charter smartened up, reaching a mobile virtual network operator deal with Verizon in 2015 that has paid off in spades. 

Also Read: Comcast, Charter Eye Wireless-Broadband Double Play  

According to Moffett, in the four years since Xfinity Mobile launched, cable wireless has grown to 6 million subscribers, becoming the fastest growing segment in the industry and accounting for about 30% of new additions. The cable wireless segment, he added, represents about 2% of the total U.S. mobile phone market.    

Because cable operators are regional players -- they only market service in their respective service territories, their wireless success is even more impressive. Moffett estimated that assuming each home has 2.5 people, Comcast and Charter have reached 4% penetration among their existing customers. 

Also Read: Cable Knocks on Wireless Giants’ Door 

Comcast said in Q1 that Xfinity Mobile reached break-even, a milestone that was helped by the restructuring of its MVNO agreement with Verizon last year. With the mobile service no longer losing money and a new, more economical MVNO deal in hand, Moffett said that encouraged Comcast to aggressively price its unlimited wireless data plans.  

“With more aggressive family plan pricing, they have a much longer runway,” Moffett wrote of Comcast’s wireless business. “And while their new pricing will mean a step backwards in near term profitability, their ability to offload traffic in the future means that they can eventually achieve at least adequate margins on what is now likely to be a much larger revenue base than we had anticipated.”   

Chicago-based private equity company GTCR said Wednesday that it has agreed to buy Consumer Cellular, the wireless service provider focused on older users, in a deal some reports value at about $2.3 billion.

GTCR has been an aggressive player in the rural cable market -- it recently sold an interest in its Mega Broadband Investments, parent of Vyve Broadband, to Cable One for $547.1 million. 

With the Consumer Cellular buy, GTCR gains about 4 million subscribers, mostly aged 50 and over. Ed Evans, a long-time wireless executive, will succeed Consumer Cellular founder John Marick as CEO of Consumer Cellular after the close of the deal, expected in the fourth quarter. Marick will remain a substantial shareholder of the company and will retain his seat on its board of directors. 

"John and the Consumer Cellular team have built a tremendous business that is well-positioned for long-term success," GTCR managing director David Donnini said in a press release. "The entire Consumer Cellular organization should be proud of the business they have built. We look forward to Ed working with the Company and its employees to continue Consumer Cellular's legacy of growth and innovation."

According to reports, GTCR beat out bidders including Dish Network, Altice USA and a group led by Boost Mobile founder Peter Adderton. 

"I am excited to partner again with GTCR and look forward to continuing Consumer Cellular's mission of providing its customers with exceptional service and competitively priced wireless plans," Evans said in the press release. "GTCR brings significant resources and experience in building industry-leading companies and together we expect to further grow Consumer Cellular's subscriber base and expand its services offering.”

Credit Suisse and Raymond James served as financial advisors and Kirkland & Ellis LLP served as legal advisor to GTCR. BofA Securities served as exclusive financial advisor and Kell, Alterman & Runstein, LLP served as legal advisor to Consumer Cellular.

Charter Communications’ top wireless executive, Craig Cowden, said the cable operator is looking to follow Comcast’s model of dual-purposing residential customer modems as WiFi hotspots.

“We see a benefit of doing that,” Cowden said, speaking last week at FierceWireless’ Next Gen Wireless Networks Summit in Dallas.

Like Comcast does with Xfinity Mobile, Charter offloads expensive MVNO cellular traffic on the Verizon network by using its network of WiFi hotspots. But Comcast’s public hotspot reach is much bigger, with much of 19 million hotspots across its footprint coming from residential customer routers which offer dual-purpose public WiFi support.

“We already offload significant traffic onto WiFi,” Cowden said. “Comcast has 19 million hotspots that are called home-as-a-hotspot, using the existing router in the home.

He added, “We’re always looking at how we can optimize the cost structure of our products.”

Cowden also spoke about Charter’s plan to use Citizens Broadband Radio Service (CBRS) spectrum to create its own pockets of cellular access, from which it could offload MVNO traffic to customers who are equipped with dual-SIM phones.

Charter is currently testing that model in New York and Los Angeles.

“We have done a lot of testing with small cells using dual SIM,” Cowden said. “We tested CBRS in 2017 in Tampa and Charlotte. We had eight different vendors just to test how CBRS would work. At end of 2018 and through now, we’ve done the next phase of dual SIM testing in New York and Los Angeles, where we have prototype devices to test the seamless switching between small cells and the macro domain.”

In recent months, cable industry analysts have gushed at the wireless convergence possibilities potentially wrought for operators using the Citizens Broadband Radio Service (CBRS) spectrum.

For Charter Communications, that future isn’t necessarily here. But the check is certainly in the mail, with the No. 2 U.S. operator now openly discussing its plans to use CBRS technology to offload mobile data traffic from its mobile virtual network operator (MVNO) arrangement with Verizon, as well as for establishing fixed wireless services in rural areas its hybrid fiber coaxial network can’t reach.

In fact, Charter’s ongoing tests seem to be going so well that chairman and CEO Tom Rutledge told equity analysts during the company’s third-quarter earnings call that the operator might bid on private CBRS spectrum at auction next year to augment the free spectrum it’s been conducting tests with.

“We haven’t determined that, but we’re looking at it closely,” Rutledge said. “We’re uniquely positioned to take advantage of wireline and wireless network convergence over time with our fully distributed wireline network.”

Fixed Wireless Play

Speaking at last month’s SCTE-ISBE Cable-Tec Expo in New Orleans, Craig Cowden, Charter senior vice president of wireless, said the operator could deploy triple-play fixed wireless services based on CBRS in rural areas, possibly as soon as the end of 2020.

Charter is currently conducting tests in rural North Carolina in which CBRS is being used to set up private LTE fixed-wireless networks in areas out of the reach of the operator’s HFC network.

The technology could come in handy for Charter in states like New York, with which it has made merger-based agreements with regulators to extend broadband access.

With the Federal Communications Commission having just approved initial commercial deployment of CBRS, Charter is looking to deliver the minimum broadband speed specifications in rural areas — 25 Megabits per second downstream and 3 Mbps upstream — while also offering customers in the newly claimed fixed wireless terrain triple-play services.

Simultaneously, Charter is testing the use of CBRS spectrum in New York and Los Angeles as a means of making its mobile service more profitable. Both Charter and Comcast have mobile virtual network operator (MVNO) deals with Verizon Communications to lease use of the No. 1 U.S. wireless operator’s LTE cellular network.

Charter added 294,000 mobile lines in the third quarter, while narrowing its losses in the quarter on the Spectrum Mobile service to $145 million. Still, given the usage costs of the Verizon network, analysts have been bearish on both Spectrum Mobile and Comcast’s Xfinity Mobile.

“It should be clear by this point that the current [MVNO] deal is a money loser for the cable operators; it’s not profitable and it likely never will be,” MoffettNathanson analyst Craig Moffett wrote in a note to investors over the summer.

Comcast, which is also testing CBRS usage, at least has the ability to offload some of that expensive MVNO usage via its 19,000 WiFi hotspots. But Charter only has around 500,000 WiFi hotspots.

Charter, however, envisions a future in which it toggles customers, equipped with dual-SIM handsets, seamlessly between the leased Verizon LTE network to its own CBRS-based wireless network, which in turn would use Charter’s DOCSIS 3.1 network for backhaul.

“We see targeted opportunities for mobile offload,” Cowden said. “Our data shows that something like 85% of outdoor mobile traffic takes place in 15% of geographic locations.”

‘Infrastructure-Based’ Agreement

Under the scenarios being tested, Charter could deploy strand-mounted small cells and create its own wireless networks that would use CBRS spectrum. Charter would create an “infrastructure-based” MVNO, similar to what Altice USA is establishing with its Sprint MVNO deal.

“We’ve talked about dual SIM technology opportunities and the testing that we’ve done, and we’re quite optimistic about the capability of that strategy,” Rutledge said. “We’re quite optimistic about the ability to make select investments in areas where traffic dictates in such a way as to move services that we pay rent for on to our own platform and that opportunity already exists with WiFi and a significant number of our customers.”

Under this scenario, analysts find the Comcast and Charter MVNO deals far more compelling “If they can offload anything close to half the cost of monthly service onto their own network, it would be a game-changer,” Moffett said in a note to investors. “In essence, they would be bifurcating the network into two buckets.”

The MVNO arrangement between Altice USA and Sprint is unique, in that the cable operator owns an increasing amount of the wireless network as it continuously builds out infrastructure.

But while the 19,000 small cells deployed by Altice USA in the Long Island area may be effectively reducing the cable operator’s reliance on the MVNO for its nascent mobile service, the agreement is not helping Sprint’s network performance, New Street Research analyst Spencer Kurn said in a report to investors published Tuesday.

Citing results from a survey of 1,000 local customers, as well as data from network testing outfit Tutela, Kurn wrote, “The network is disappointing. Based on the Tutela data and our own speed tests, it doesn’t seem like the deployment of 19,000 small cells has improved Sprint’s network much. There is little evidence of improvement year over year; Sprint’s network in Long Island appears worse than in the rest of the country, and Sprint still lags the other national carriers in Long Island.

“Sprint’s network has always lagged the other three carriers in terms of network performance,” Kurn added. “The primary reason has been the amount of low frequency spectrum they have and the amount of nodes. We had thought that Altice deploying 19,000 small cells would really close the gap, but the data doesn’t show that. Sprint still lags other carriers by a pretty wide margin.”

Tough zoning laws have traditionally made Long Island a difficult market for wireless operators to increase network capacity. And Kurn conceded that at least to some degree, Altice’s small cells must be enhancing Sprint’s network.

“But it’s very possible the absence of the low-frequency spectrum really limits the range of Sprint’s network,” he said. The small cells aren’t going to improve that that much. It’s still disadvantaged from a coverage perspective.”

Seven years after Comcast and Charter ushered in the new era of cable wireless service with their landmark mobile virtual network operator (MVNO) agreement with Verizon, MoffettNathanson principal and senior analyst Craig Moffett believes that it is time for the cable industry to forge a better deal.

Comcast and Charter's current MVNO, part of the cable operators’ $3.9 billion sale of wireless spectrum to Verizon in 2012,  has allowed both operators to offer wireless service to its customers — Xfinity Mobile and Spectrum Mobile — and has been moderately successful. But while Comcast has about 1.2 million Xfinity Mobile lines since launching the service in 2017 and Spectrum Mobile, which Charter launched in September 2018, had about 134,000 users in Q4, neither service makes money, according to Moffett. Part of the reason is the inherent nature of MVNO agreements.

Related: Comcast Loses Over $1 Billion on Xfnity Mobile in First 2 Years 

In a blog post, Moffett estimated if Comcast is charging customers $45 per month for unlimited wireless service and paying about $5 per Gigabit per month to Verizon, data costs alone for the operator would be $40 per month on very conservative usage of 8 GB per month. Add another $5 per month for voice, and unlimited customers are a losing proposition even before SG&A, customer service and acquisition costs are factored in, the analyst added. And as for claims that cable wireless is an effective churn reducer, Moffett calls those arguments “really just tie-breakers.”

After going through several different alternative scenarios for operators, including buying a wireless carrier (not regulatorily feasible), or building their own wireless network (not financially feasible), Moffett settled on what he thinks could be a win-win for both sides — take a truly collaborative approach to wireless.

The industry already has an example to build from — Altice USA’s mobile virtual network operator (MVNO) deal with Sprint. Altice is expected to launch its wireless service later this year, but according to Moffett, its economics are better than Verizon-Comcast-Charter because under Altice’s deal Sprint is allowed to build small cells on Altice’s network. Sprint pays nothing to Altice — other than construction costs — and in turn the cable company gets to ride on those small cells for free. The more cells there are, the lower the cost of the MVNO. According to Moffett, Sprint has already deployed about 19,000 small cells on Altice’s network in the greater New York area under the agreement.

Related: Altice Eyes CBRS Small Cell Strategy 

“It’s a rather elegant solution,” Moffett wrote. “Sprint gets a huge cost and time-to-market advantage versus Verizon, AT&T, and, if the deal is rejected, T-Mobile. And Altice USA gets an MVNO agreement which gets cheaper and cheaper over time as more and more traffic is carried by their joint small cells.”

Moffett added that Altice has indicated the arrangement would continue if Sprint’s planned merger with T-Mobile is approved.

“One can immediately see how the relationship gets deeper and deeper over time, as Sprint’s and Altice’s networks get more and more intertwined,” he wrote. “Either party exiting the relationship becomes almost unthinkable after enough small cells have been jointly built.”

While the size of Altice’s New York footprint -- about 4% of the households in the U.S. -- might limit the appeal of the Sprint agreement with larger operators, Moffett believes it could work on a national scale too.

To Moffett, an Altice/Sprint-like deal that encourages the buildout of small cells would be a more cost-effective path toward 5G, and that cost advantage would grow over time. What’s more, with a new MVNO deal, Comcast and Charter could make money on wireless because the costs would drop as the density of the cells increased, and the quality of service to customers would improve.

“They would have ‘solved’ the wireless question without the multi-tens-of-billions of dollar outlays that would come with either an unwieldy and risky acquisition or, worse, a de novo buildout,” Moffett wrote. “And Verizon would benefit from that, too, since any customer Comcast and Charter acquired would be a Verizon wholesale subscriber.”

There would be obvious hurdles to clear — mainly overcoming fears that either would use the new arrangement to cannibalize the others’ businesses. But Moffett believes the parties will ultimately come to the realization that they are better off together than apart.

He pointed to when the SpectrumCo consortium first considered selling its wireless licenses to Verizon in 2011. 

“What started as a simple spectrum sale ended with a strategic alliance that didn’t just create the cable MVNO we know today, it also envisioned a future where Verizon would resell cable broadband across their footprint (astonishingly, even in markets where Verizon was selling FiOS service),” Moffett wrote. “The latter initiative never fully materialized for a variety of reasons. But the companies, even then, evidenced a clear understanding that they would be better off together than apart. Perhaps they weren’t wrong … they were only early.”

Prone to distraction and sudden abandonment of its dalliances into the telecom marketplace, Google is actually pushing more chips into its MVNO-based mobile service.

This week, it announced a new name for the erstwhile Project Fi, now calling it “Google Fi.” The service will now work with many more devices to, with most iPhones and Androids compatible with the service.

This is, of course, unwelcome news to the top three U.S. cable companies. Comcast and Charter Communications have, in partnership, launched mobile services that combine the strengths of their respective public WiFi networks with a mobile virtual network operator agreement with Verizon. (Such an MVNO deal allows the cable companies to lease access to Verizon’s wireless LTE network.)

Altice USA, meanwhile, will launch a mobile service next year based on an MVNO agreement with Sprint.

As for Google Fi, it launched three years ago, offering customers MVNO access to either T-Mobile or Sprint. It later added regional wireless network operator U.S. Cellular to the choices.

The multiple options have been a selling point, with the undisclosed number of Google Fi customers able to choose the network that works best for them, depending on where they were located at any given time.

Users, however, were limited in terms of phone choices, with only models like the Pixel 3, the Moto G6 and the LG V35 including the chips needed to toggle between the multiple LTE networks.

With the new BYOD expansion, iPhone and Android-equipped Google Fi users will largely be confined to T-Mobile’s network, given their phones inability to toggle between MVNO providers.

Google’s sudden doubling down on its MVNO service somewhat surprised the tech press, which has seen the Silicon Valley giant in recent years abandon such telecom-centric efforts as wireline broadband play Google Fiber.

However, there are still plenty of reasons why Google Fi competes well with Xfinity Mobile and Spectrum Mobile.

Start with price. Users can pay $20 a month for one line that includes unlimited talk and text, and $10 a month for every 1 GB of data use, up to a maximum of $60 a month. For those who can confine their data use to WiFi, that’s a $30 a month wireless plan. And $80 a month will provide unlimited talk, text and data usage.

And there are other perks. For example, users who have a secondary device like a tablet can enable data usage for that device, with no extra line charge, simply by adding a SIM card. 

Altice USA continues to tout the benefits of its “full MVNO” approach for a mobile service it still says is on track to launch in the first half of next year.

Notably, the company said it is building out so much wireless network infrastructure, it will operate more as a mobile network operator than a mobile virtual network operator that leases wireless network services. 

“We will be operating our own core network with its own [Home Location Register], which is the brain of the mobile network,” said Altice USA CEO Dexter Goei, speaking during the operator’s third-quarter earnings conference call.

“This means we will manage our own customer base and mobile services, as well as provide our own SIM cards, so we can negotiate costs with our SOM suppliers directly and mange the configuration where we have scale and benefit from a lot of legacy experience in countries outside the U.S.,” Goei added.

Related: Altice Says ‘Facilities-Based MVNO’ Approach Limits Partnership Potential with Comcast, Charter

Altice USA is launching its mobile service based on an MVNO deal carved out with Sprint last year. The cable operator agreed to help densify the wireless company’s network to enhance coverage and capacity in its own footprint. Goei said Altice still has a lower wholesale network lease price than “light MVNO” users like Comcast and Charter, which have partnered up with Verizon.

“In other words, we are getting ready to operate almost like an MNO and will provide a great value proposition to our customers and the market,” he said.

“We basically own and control everything apart from spectrum and base stations, although we are currently testing CBRS spectrum, and will see if any spectrum locally becomes available,” Goei added.

Related: Charter Reports 21,000 Mobile Sub Lines, Mulls CBRS Network Plans

Altice, Goei explained, has a “path” to a spectrum strategy, whereas light MVNO users need to switch strategyes and build out their own mobile infrastructure to capitalize on the benefits of the Citizens Broadband Radio Service.

Goei also touted the Altice’s ability to deliver better data offloading, noting that the operator’s dense WiFi coverage will enable better handoff between networks.

And he added that a “light MVNO restricts the services you can offer and how you can market to customers … You might have to sell in bundles and might not be able to sell a standalone product.”

Charter Communications CFO Chris Winfrey is not in the camp that suggests that upcoming fixed 5G services from wireless operators represent an “existential threat” to the cable industry.

“I don’t see anything about 5G that ever makes it comparable to DOCSIS 3.1 or DOCSIS 3.1 Full Duplex, or any capability we have through fixed line service,” Winfrey said, speaking at the Bank of America Merrill Lynch Media, Communications & Entertainment Conference Thursday.

“When I look at 5G and what it takes to deliver 5G, when it finally becomes real … we have it,” Winfrey added, noting that cable companies have vital infrastructure that wireless operators will need to fully deploy the technology.

In order for 5G to work, he added, "you have to be relatively close to the home with fiber, and you need to have power. And to replicate that without cable infrastructure, you really need to be a cable over-builder…I don’t see any rationale for someone to do that.”

Speaking on a wide variety of subjects, Winfrey said the summer launch of Charter’s new mobile service, Spectrum Mobile, was really just a soft launch.

“The marketing machine didn’t get turned on until Tuesday,” he said, noting that the bulk of activations in the third quarter will have come after Labor Day, when the wireless service finally got deployed across Charter's footprint.

Winfrey reiterated Charter’s position that mobile, first and foremost, fills the role of helping Charter more effectively bundle and sell fixed-line broadband services. “We think it’ll result in more internet and more connectivity going into the home,” he said.

Winfrey conceded Charter’s desire for “core control” of its MVNO deal with Verizon, which is the foundation of Spectrum Mobile. But he said that 80% of the traffic for the service occurs over Wi-Fi. Over time, he explained, a portion of the 20% of traffic that is handled by leasing network services from Charter will be handled by services enabled through licensed and unlicensed spectrum.

Meanwhile, while also addressing the topic of video, Winfrey also described an existential theme that relates to connectivity.

“Video does matter to what we do in internet and mobile and overall package of connectivity services,” he said. “It doesn’t really matter if we lose or grow video subscribers. I can’t name one mobile operator not trying to get into the video space.”

Add Altice USA to the growing list of communications companies coming out against the proposed T-Mobile-Sprint merger, claiming in its petition filed with the Federal Communications Commission Tuesday that the deal could makes its ongoing wireless agreement with Sprint difficult.

Dish Network filed a similar petition against the merger with the FCC on Monday.

Altice USA signed a Mobile Virtual Network Operator agreement with Sprint in 2017 to provide wireless services to its customers in the New York area and the Midwest.  Altice expects to launch the wireless service early next year.

But in its petition with the FCC, Altice USA said a Sprint merger with T-Mobile could have an adverse effect on its own wireless deal with Sprint.

Related: Former Altice Exec Resurfaces at Sprint 

In its FCC filing, Altice sad it was confident in its ability to offer its wireless service in 2019, a product it said had strategic importance for both companies.

But the operator said it “has concerns about the opportunity to expand its wireless service nationwide and over the long term, because T-Mobile and the New T-Mobile have made no tangible commitments regarding meaningful support for current MVNO partners, including offering such partners the full nationwide network that the New T-Mobile will enjoy. The concerns of Altice are magnified in view of T-Mobile’s hostile statements against MVNOs, including cable operators entering the wireless market.”

Related: Altice USA Hires Jean Charles Nicolas to Lead Mobile Unit 

While Altice said its Sprint MVNO will continue after Sprint is acquired, there are no guarantees that T-Mobile will support the MVNO market once the merger is complete, especially its commitment to supporting further expansion in the wireless arena. That commitment is critical to the survival of any MVNO service, Altice USA said in the filing.

“Altice’s agreement with Sprint clearly accounts for the continuation of the relationship if Sprint is acquired,” Altice USA said in the filing. “However, given the lack of firm commitments by [T-Mobile] to support the MVNO market if the merger is consummated, Altice is concerned about [T-Mobile’s] willingness to support Altice’s further expansion in the wireless market.

“ ...it clearly is not lost on Applicants that MVNOs such as Tracfone, Altice, Charter, and Comcast need nationwide, long-term, wholesale arrangements in order to provide nationwide wireless service and, without these arrangements, MVNOs cannot compete,” Altice USA continued. “However, without actual commitments from the New T-Mobile to provide its MVNO partners with durable, long-term, nationwide wholesale terms, the competitive impact of these MVNO partners will not exist and cannot be considered by the Commission.”

Altice USA fears that instead of supporting its MVNO deals, the New T-Mobile will be incentivized to “expand its own market power y refusing to offer reasonable, nationwide, wholesale wireless terms to its MVNO partners. T-Mobile’s own comments to date, and its refusals to make commitments to the MVNO market, already have telegraphed this result.”

To remedy that situation, Altice USA proposed that as a condition to approval the New T-Mobile must agree to honor and implement existing MVNO agreements. Other conditions proposed by the cable operator inclide: agreeing to offer MVNO partners for the full term of their existing agreement or 10 years (whichever is later) the best wholesale terms and conditions; divesting spectrum that exceeds the spectrum screen, and associated network infrastructure, in order to make those assets available to MVNOs, and smaller wireless players that need spectrum; and filing detailed quarterly reports with the Commission describing New T-Mobile’s status in implementing the conditions for 10 years after the deal is complete. 

While Comcast and Charter Communications have enjoyed a close partnership for their respective mobile business, sharing everything from merchandising plans to backend technology, their appear to be limits as to just how much Altice USA can collaborate with the two biggest U.S. cable companies in regards to its own MVNO business.

“Ours is a facility based. Theirs is a light MVNO, which makes it a little bit difficult today to cooperate specifically around infrastructure,” said Altice USA CEO Dexter Goei, during his company’s second quarter earnings report.

Related: Comcast, Charter Form Mobile Platform Partnership

“We clearly can cooperate around whether it be marketing, cross-marketing, maybe some supplier acquisition stuff,” Goei said. “But as you know, we are so active globally as a group, and we've maintained very good relationships on a global level with the key suppliers, that we've been able to go ahead and do a lot of this stuff on our own. But I don't ever eliminate the possibilities or the attractiveness of teaming up with our friends from Charter and Comcast on anything relating to that.”

Last year, Altice USA announced an MVNO partnership with Sprint. The cable operator said it will deploy a mobile service built around the deal in 2019.

Related: Altice USA, Sprint Strike ‘Full’ MVNO Deal

“We have a full infrastructure-based MVNO, which has attractive economics and flexibility features for us,” Goei said. “We have a dedicated and experienced mobile management team which will lead the development, launch and ongoing mobile strategy. In terms of network development the densification of Sprint's network, which we're helping with our AirStrand deployment is comfortably ahead of schedule as are the upgrades to and expansion of our WiFi network. We are also testing CBRS spectrum with equipment in a 3.5 gigahertz band as this may be good complementary capacity for us.”

Charter Communications launched its much-awaited Spectrum Mobile wireless services on June 30, offering customers flexible data pricing plans similar to Comcast’s Xfinity Mobile.

That makes sense given the Charter service stems from the same Verizon Mobile Virtual Network Operator (MVNO) agreement that is the basis for Comcast’s Xfinity Mobile service, which was launched last year. 

The 4G LTE Spectrum Mobile service is connected to the cable operator’s WiFi hotspots across the country, according to Charter.

Related: Charter Eyes June 30 Debut for Spectrum Mobile Launch: Report

Charter and Comcast formed a joint venture in April to develop and design backend systems for both mobile products. 

Related: Comcast, Charter Form Mobile Platform Partnership 

Customers can pay for data in two ways – a flat $45 per month, per line fee for unlimited data; or they can pay by usage. The "By the Gig" plan is the only area Spectrum Mobile differs from the XFinity Mobile product – Charter charges $14/GB per month on that plan, while Comcast charges $12/GB. Both Spectrum Mobile plans include free nationwide talk and text.

Like XFinity Mobile, customers can switch data plans during the month, so they only pay for the data they need. Charter claims Spectrum Mobile customers can save as much as 40% over competing wireless services.

Spectrum Mobile also offers mobile devices via interest-free installment plans. Devices from Samsung and LG are available today, with other devices available soon. For more information, visit Spectrum Mobile here. 

Altice USA said it was going to take a different approach to the cable business after it purchased Suddenlink Communications in 2015 and Cablevision Systems in 2016 for a combined $27 billion. And while its results since then have been pretty much in line with the rest of the industry, it has excelled in growing operating profits, which in the fourth quarter were more than twice some of its peers at 12.2%.

Altice USA finished the year with a loss of about 25,000 video customers, slightly higher than the 21,000 it lost in the prior year. High-speed data growth at 26,000 was in line with the prior year gain of 36,000. Revenue grew 2.6% to $2.4 billion.

But the company really outshone its peers with 12.2% cash flow growth, nearly two times the 6.2% much larger Charter Communications reported in its Q4 results and nearly three times the 4.2% at Comcast’s cable division in the period.

When Altice purchased Cablevision Systems in 2016 it said it had a plan to drastically cut costs and drive cash flow growth. Although it was met with some skepticism at the time, so far Altice as delivered.

In a conference call with reporters, Altice USA CEO Dexter Goei said the Q4 numbers shouldn’t come as a surprise.

“We’ve been very open that we’ve brought a differentiated approach to running these businesses,” Goei said. “Now we’re about two years into it and have been able to realize a significant amount of opex, capex and direct cost synergies here, to drive our business and drive better free cash flow margins. I think it’s a combination of coming from an environment which is very highly regulated in Europe and somewhat more competitive with much lower ARPU levels, which means we have to work a lot harder for less in our European properties. We’ve instilled that mentality into our Altice USA employee base. Secondly, I think we have taken the historic capex budgets and been able to save quite a bit of money with key suppliers as well as eliminate what we would view as non-core projects and reinvest that into things like the Altice One box which is a game changer for us, like fiber to the home and like a full MVNO.”

Altice USA unveiled its communications hub, Altice One, in November, offering seamless navigation across traditional video and over-the-top services as well as whole-home WiFi connectivity, a voice remote and other features. Its fiber to the home project, which will enable a more connected home and higher data speeds, is progressing with construction to connect several hundred thousand homes in New York, New Jersey and Connecticut underway. The fiber network build is expected to accelerate in 2018 with the first commercialization of FTTH services later this year. The company struck a full Mobile Virtual Network Operator agreement with Sprint to offer a wireless service. Goei said the company expects to launch the service in 2019.

SAN ANTONIO, Texas -- New Street Research managing partner Jonathan Chaplin said the cable business is going to look vastly different in the next five years.

“In five years you’re going to go think about this industry very differently,” Chaplin said at the NCTC Winter Educational Conference here Monday. “Today the wireless and cable industries have completely separate networks. In five years, those networks will be as one. The industries are going to converge as well.”

Read More: Additional Coverage of the NCTC Winter Educational Conference

Chaplin calls the coming wireless battle a Clash of the Titans, pitting large cable operators like Comcast and Charter against wireless behemoths like AT&T and Verizon Communications.

Both industries are putting their competitive toes in each other’s business, with Comcast and Charter Communications striking Mobile Virtual Network Operator (MVNO) agreements with Verizon Communications. Altice USA struck a similar deal with Sprint late last year and Cox Communications is expected to have a similar offering, most likely with Sprint at some point, Chaplin said.

MVNO agreements help make the economics of wireless better for cable operators, Chaplin said. He estimated that with their current MVNOs, Comcast and Charter can offer wireless service at the same cost as the No. 3 operator in the country, T-Mobile. As more and more voice traffic moves over IP and WiFi, those costs drop to the level of the No. 1 and No. 2 providers, Verizon and AT&T.

Lower costs mean a greater opportunity to offer disruptive pricing. And the advent of 5G will further lower those costs, as well as reducing dependence on MVNOs.

Chaplin estimated the wireless business is about twice the size of the cable business and that in the ensuing battle for customers, cable will win, gaining nearly $30 billion in wireless revenue, mostly at the expense of existing carriers. Those carriers will likely gain about $5 billion in broadband revenue, which will be offset by the wireless declines.

When I first heard that Comcast and Charter were in talks with Sprint about a possible wireless partnership, I’ll admit my first thought was: “Will these guys ever learn?”

Because cable has a long and checkered past with Sprint regarding wireless joint ventures, beginning with Sprint PCS in the early 1990s, which was supposed to be cable’s entrance into digital wireless but wasn’t, to the Pivot JV which failed in 2008 and the Clearwire WiMax consortium that fell apart in 2012.

Not a track record that inspires success, especially when cable’s latest foray into wireless – a pair of Mobile Virtual Network Operator (MVNO) agreements Charter and Comcast reached with Verizon – seemed like the right move. Using Verizon’s nationwide network – the largest and most reliable, at least according to their commercials – Comcast and Charter could offer a wireless complement to their existing products. Comcast launched Xfinity Mobile in April, making the product – through a bundle of data or video or both – widely available throughout its footprint earlier this month. Charter’s offering is expected to come next year, and details are a little sketchier.

But the venture seemed to be the best of both words for cable – they can lease Verizon’s network without have to go to the expense of building their own, they can brand the service themselves and have full ownership of the customer. Why muck up what seems to be a good relationship with a Sprint deal?

That seemed even more apparent when Comcast and Charter agreed to a wireless partnership that would prevent them from making a transformational acquisition for one year – a condition many said would keep them from buying a wireless provider. That deal also seemed to be a way to cut costs through jointly buying equipment and developing platforms together.

Now these talks seem to threaten what could be a successful wireless venture for cable. But maybe it’s just insurance.

Other analysts have weighed in on the talks, first reported by the Wall Street Journal, with a healthy dose of skepticism. Most, agreed with the tone of the ournal story in that they didn’t believe that some aspects of the talks – that Charter and Comcast would make an equity investment in Sprint or buy the whole company – will ever come to light. To many, a deal could have two goals – forcing Verizon to modify the pricing of its existing MVNO deal, and force better terms in a T-Mobile/Sprint.

In a note to clients, Barclays media analyst Kannan Venkateshwar wrote that while it’s too early to tell, “this news is likely to create some confusion around scale of initial launch, cost structure of the wireless business, execution risk as well as strategic intent.” But he added that it could put pressure on T-Mobile to strike a deal with Sprint because it gives the latter another option.

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak also agreed that a Comcast-Charter merger with Sprint is a long shot, but added that having another MVNO partner could help ease the burden for the cable operators.

“Cable has a lot of leverage especially with Charter and Comcast working together,” Wlodarczak said. “Why not use that leverage? Who needs a Verizon MVNO deal struck long before the wireless economics fell apart.”

That is a key point and could be the main reason these talks even started in the first place. In a research note UBS telecom analyst John Hodulik wrote that when the original MVNO agreement was reached, average data usage was under 1 GB per month and were likely restrictive. Today, unlimited data plans rule and any Sprint MVNO would probably be restriction-free.

Wlodarczak also believes that just talking to Sprint could kill two birds for all parties involved – it could perhaps motivate T-Mobile to strike a merger deal and get Verizon to amend its MVNO terms more favorably.

“You would partner with Sprint if you thought a merger would go through with T-Mobile,” Wlodarczak said. “They eventually will have a robust network or Sprint simply offered a dramatically better MVNO arrangement and by talking to Sprint it could lead to Verizon (or even AT&T) giving you a much more attractive deal.”

Cable’s latest attempt to crack the wireless code — the multiple virtual network operator agreements Comcast and Charter Communications have struck with Verizon Communications — could provide the economic basis for a successful run in what has been an elusive market for the industry.

But as the service matures, those same economics could push the companies toward a deal with a wireless company in the next several years, according to some analysts.

Both Comcast and Charter Communications have activated MVNO agreements with Verizon, with Comcast offering its Xfinity Mobile product across its footprint this month. Charter is expected to launch its wireless offering in 2018.

Related: It's Early, but Comcast Optimistic About Xfinity Mobile

In a research note, UBS telecom analyst John Hodulik wrote that the U.S. track record for MVNOs is mixed: The most successful, American Movil’s Tracfone, has attracted 25 million customers over the past two decades, but its margins are razor-thin.

In Europe, cable operators have had better success, with Liberty Global’s Telenet wireless offering, launched in 2006, attracting nearly 10% of the market.

Telenet, the largest cable operator in Belgium, has an MVNO with Orange, that nation’s biggest wireless carrier. But Orange has benefitted most from regulatory changes that shortened the duration of wireless contracts from 24 months to six months. With more customers up for grabs, Telenet was able to attract a large chunk of subscribers mainly through discount pricing — it offers service for 20% to 30% less than incumbents.

MVNOs Don’t Scale Well
But Telenet eventually hit a wall. As data usage climbed, it became economically feasible to own the infrastructure, and Telenet acquired wireless carrier BASE in 2015.

“Telenet ultimately acquired BASE in order to control its own wireless destiny as growing data usage made it more attractive to own mobile infrastructure,” Hodulik wrote. “As we have said previously, we believe MVNO economics get more challenging as the business scales and data traffic grows, suggesting Comcast and Charter could pursue a similar approach in time.”

According to Hodulik, Comcast and Charter have the potential of taking a significant chunk of the wireless business — a combined 10% by the end of 2020 — also largely on price discounting.

Comcast announced its Xfinity Mobile product in April and initially tested the service with employees. It is scheduled to be offered to all Comcast customers in its footprint this month.

Xfinity Mobile is mainly about flexibility, both with plans and with pricing. Customers can choose unlimited data or pay-as-you-go plans, and pricing ranges from $45 per month per line for its top-of-the-line X1 platform subscribers to $65 per month per line for any customer who buys any package that includes Xfinity Internet. Even at the top of the range Comcast beats AT&T’s initial price of $90 for the first line and Verizon’s $80.

At those prices, Hodulik believes Comcast can take a serious piece of the wireless market. He estimated the MSO could attract nearly 3.5 million wireless subscribers by 2020, with Charter snagging 2.5 million.

“Assuming similar market growth, we estimate gains at Comcast and Charter will pressure phone net adds at the existing players in 2018, pushing AT&T and Verizon further into the red while crimping growth at T-Mobile and Sprint,” Hodulik wrote.

Wireless growth has already been slowing but the UBS analyst sees AT&T’s wireless customers actually declining from 77.8 million in 2016 to about 76 million by 2018 while Verizon wireless customers dip from 108.8 million in 2016 to 107.8 million in 2018. For T-Mobile and Sprint, which have had a bit of a growth spurt in the past two years — T-Mobile added more than 7 million customers between 2014 and 2016 and Sprint added 1.8 million — that pace will slow.

Hodulik expects T-Mobile to end 2018 with 40.2 million customers (up 5 million from 2016) and Sprint to end 2018 with nearly 32 million customers, up by about 300,000 customers from 2016.

Retention Aid, Not Cash Cow
Pivotal Research Group CEO and senior media analyst Jeff Wlodarczak said those levels of wireless subscribers are reasonable, but added that he believes for Comcast and Charter the wireless offering is more of a retention tool.

That, he said, should help lower subscriber churn, and in the event the quad play, becomes more important domestically, should give them early experience with the product. But MVNO economics don’t necessarily lend themselves to big profits, he added.

Low profit expectations have been a trend in the wireless business for the past few years. According to Hodulik, EBITDA growth peaked in the sector in 2015 at 23%, falling to 1% growth in the first quarter of this year. Margins have been strong — overall, about 37.7% in 2016, a level that is expected to be maintained in 2017 — but are expected to slow going forward as capital expenditures, on the decline for the past three years, begin to tick up.

Whether Comcast or Charter would acquire a wireless carrier in the future is unclear. For now, the two have agreed, under a wireless partnership to share platforms and equipment reached in April, not to make a large wireless purchase without the other’s permission for at least a year. That doesn’t preclude a joint purchase, but most analysts take it to mean the two will sit out any M&A for the next 12 months.

Dish Spectrum in Sights?
With Sprint and T-Mobile possibly off the table, that leaves Dish Network.

Dish has wireless spectrum, and the need for a partner to help build it out. According to its FCC license agreements, it has to build out 70% of the country by 2020. Hooking up with a large cable operator could help.

Wlodarczak said any deals are probably well off in the future. And he doesn’t believe there is any need to rush.

“I am actually not convinced cable needs to do a wireless deal, but if they are serious about getting into wireless, I think it would better to buy [T-Mobile] now,” Wlodarczak said.

With its larger U.S. competitors joining forces to offer a wireless product, Altice USA CEO Dexter Goei said the U.S. arm of European telecom giant Altice N.V. would be open to paring up with a wireless carrier to offer service, most likely through a Mobile Virtual Network Operator agreement.

Both Comcast and Charter have MVNO deals with Verizon Communications, and earlier this month unveiled a partnership that would allow the two to pare costs and search for operational efficiencies. 

In a conference call with reporters, Goei said the Comcast-Charter deal was “smart,” adding that Altice USA also was taking its time to evaluate its wireless options.

“We’ve also been very public about saying that we are going to take our time to see what type of wireless offering we want to do and what type of form it will take,” Goei said. “We said on our last earnings call that we would have discussions around MVNO. Longer term, are we interested in more fixed infrastructure? I think it’s unclear. We are very much in line with our cable brethren here in terms of taking our time to evaluate what our options are on wireless.”

Goei declined to answer any questions about Altice USA’s pending initial public offering. Altice USA filed preliminary documents with the Securities and Exchange Commission concerning the IPO in April, and Goei said the company expects to receive comments from the SEC later in May.

While revenue at the U.S. operations were up 3.2% (Optimum) and 5.3% (Suddenlink), Altice USA shed about 35,000 video customers in the period, a slight increase over the same time last year. At its Optimum systems – mainly in the New York metropolitan area – losses were about 15,000, in line with last year. At Suddenlink, video losses numbered about 20,000, slightly more than the year before.

“Clearly we’ve always believed that the weakness in video, specifically on the Suddenlink side of our business, was related to the quality of the product, which we’ve been working very hard on improving, the quality of the user experience, particularly. Many things are being put into place: One [is] additional content; Two [is] better user experience through a network DVR and with the launch of our new [communications hub], focusing on dramatically changing the user experience across the Altice USA footprint.”

That additional content won’t necessarily mean that the Viacom networks, which Suddenlink dropped in 2015, will be returning though. 

Goei wouldn’t give specifics, adding that Altice is looking at several programming options.  

“We are evaluating lots and lots of different options all the way from traditional linear to multiple forms of premiums to other types of millennial/OTT content,” Goei said. “I don’t think there is any particular names to be speaking about at this stage as we focus on reviewing the various opportunities we have.” Goei added that the home communications hub should be launched late in the second quarter or early in the third quarter.   

After several failed attempts to succeed in the one transport medium it has so far failed to conquer — wireless — the cable industry is gearing up for battle, using pricing and its superior broadband products to slice market share from entrenched incumbent providers.

Comcast fired the first shot with the unveiling of its Xfinity Mobile product last week, a 4G and WiFi hybrid that appears to compete primarily on price. But unlike other failed attempts at breaking into the wireless market, Xfinity Mobile appears to be more of a defensive play than an offensive one, geared toward reducing churn and preserving the existing business as much as gaining new customers.

Comcast scored big with consumers with the elegant navigation of its X1 platform, currently available to more than 50% of its footprint and one of the reasons it was able to grow basic video subscribers last year for the first time in a decade. X1 customers are less likely to churn than other video subscribers and use more services.

With Xfinity Mobile, the nation’s largest cable operator appears to be extending the X1 concept to the wireless business, offering competitive pricing as well as a few bells and whistles, such as the ability to text customer support and authenticate all of a customer’s Xfinity apps in one swoop.

Telsey Advisory Group media analyst Tom Eagan said Xfinity Mobile has some compelling features — he particularly liked the flexible packages and the ability to text customer service — but he doesn’t believe the intention is to offer, at least initially, a state-of-the-art product.

“I don’t think what they’re offering here is head-and-shoulders above the rest, feature-wise,” Eagan said. “But what we’ve seen is it tends to lower churn. The fact they are committing to the [mobile virtual network operator] means that this is going to be an economically accretive event.”

Eagan also doesn’t believe, despite the price, that Comcast is starting a price war.

“I don’t think this is a major price war — Comcast isn’t coming in with a price of $20 per line,” Eagan said. “To me, it’s about the benefit of the overall business.”

He pointed to Liberty Global’s Virgin Media, which has been offering a quad play since 2014. What Virgin Media found is wireless makes the bundle extremely sticky — churn for its quad play was about 0.7%. That compares with 2%-3% and higher for some U.S. cable companies.

“The story makes sense because of what we saw with X1,” Eagan said. “I think Comcast customers have a positive experience. That should help [the MSO] in terms of deeper penetration.”

DIFFERENCE OF OPINION
To the more skeptical, Xfinity Mobile appears to be what has sunk previous ventures into the space — a cellular phone service whose only differentiator is its name. But in a briefing with analysts last week, Comcast executives tried hard to drive home the point that they indeed had something different on their hands.

What seems to be the most different is the price — Comcast is offering unlimited data plans with no access fees for $45 per month for its X1 platform customers and $65 per month for the rest of its base. The wireless offering can only be purchased as part of a Comcast bundle — either voice, video or high-speed data — but customers also can opt for a pay-as-you-go plan that charges $12 per Gigabyte of data.

“This will be designed to support the core cable business,” Comcast Cable CEO Dave Watson said at the launch event in New York last week. “We do have confidence in our ability to compete in a crowded marketplace.”

Comcast’s presentation was chock full of data. Watson, who spent years in Comcast’s former cellular division before becoming chief operating officer in 2010, touted the size of the potential market.

Of all the cable operators in the country, Comcast has the greatest scale — 22.5 million basic video customers, 24.7 million broadband customers and 11.7 million digital telephone subscribers. In all, it has 28.6 million customer relationships. But that scale is dwarfed by the size of Verizon Communications’s and AT&T’s wireless bases, at 114 million and 110 million customers, respectively. Even No. 3 wireless provider T-Mobile USA has 71.5 million customers and No. 4 Sprint has 59.5 million. From the outset, Comcast will be a distant No. 5 in a five-player market.

Scale is essential in the wireless market: It is the main difference between Verizon’s wireless margins of 14% and Sprint’s -5.6% margins.

“It’s a fixed-cost business,” Moody’s Investors Service vice president and senior credit officer Mark Stodden said. “So it becomes a money loser if you’re operating below a certain scale, because there is a certain standard of network coverage they need to have as table stakes. It is a curious time to get into the wireless business.”

At the same time, the wireless players are encroaching on the video business. AT&T purchased DirecTV in 2015 for $48.7 billion and in December launched its DirecTV Now over-the-top service, utilizing wireline and wireless transport. Last year, the carrier said DirecTV Now customers that were also customers of AT&T Wireless service would not be subject to data limits when watching the video service on its network.

Verizon, which launched its wireline Fios TV service more than a decade ago, introduced a free mobile video service go90 in 2015 (which is currently undergoing an overhaul). And last month it revealed a new corporate structure aimed in part to make it easier to launch its own mobile over-the-top service. The wireless business is clearly going video.

MOBILE INTENTIONS
Mobility is obviously the future, but until recently the cable business was content to provide the content and the fiber backbone that made that possible. While that has changed, merely stapling a wireless service onto an existing bundle hasn’t worked before and won’t likely work again.

But Stodden added that the growing adoption of mobile video is forcing pay TV distributors to at least look toward wireless platforms.

“You need to assess whether you need to own that mobile distribution platform to continue to play in that space,” Stodden said. While that could eventually mean buying a wireless carrier, he believes the safest route is an MVNO.

“Purchasing a wireless company could be potentially damaging in some areas because there would be areas where they would be wireless-only,” Stodden said. “Those would be money-losing areas. Within their wireline footprint they could have a pretty good cost structure because they have a lot of network capacity and they have a very dense footprint.

The MVNO architecture gives them a lot of flexibility to target only their wireline footprint.” Other cable operators’ plans for wireless ventures remain uncertain. Charter Communications activated its Verizon MVNO last year and has said it will release a product sometime next year. Chairman and CEO Tom Rutledge has kept the company’s wireless plans close to the vest, but he has hinted that the Stamford, Conn.-based operator will lean more toward 5G. Charter had no comment on Comcast’s Xfinity Mobile plans.

“We have no additional information regarding our wireless plans at this time,” Charter said in a statement.

Xfinity Mobile is Comcast’s cautious approach to the wireless business, Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said.

“They are dipping their toes in the water and seem to be taking a go-slow approach,” Wlodarczak said, adding that the most compelling aspect of the service is its ability to automatically hand off calls and data between its WiFi and 4G LTE networks.

And though Comcast likely can build a formidable wireless business, he said, Wlodarczak doesn’t see any cause for the bigger players to panic just yet.

“Maybe five years from now you can have a $1 billion, low-margin business that helps reduce overall churn,” Wlodarczak said. “I don’t think the existing wireless players are quaking in their boots from this initial foray.”

UNLIMITED BATTLE FOR SUBS
Over the past several months the top wireless players have upped the ante in their own battles for customers, with Verizon, AT&T, Sprint and T-Mobile all offering unlimited data plans. Verizon has been particularly aggressive, offering unlimited data for $45 per month for a four-line family plan service, a free iPhone 7 and offering to buy out the customer’s existing wireless contract. In a research note in February after that Verizon plan was unveiled, MoffettNathanson principal and senior analyst Craig Moffett estimated that Verizon could potentially spend $6,000 to acquire a family of five’s business.

Xfinity Mobile isn’t spending nearly that much. Comcast estimated it would spend about $200 million to $300 million for the first year of the service and said at the launch event that it would be profitable.

Wireless has been an elusive target for the cable industry for decades. From the PCS (short for Personal Communications Services) partnerships with Sprint in the 1990s, to joint ventures in the 2000s with Sprint again that were supposed to usher in the age of mobile video, cable has spent years and billions of dollars to pair its superior wireline network with wireless. It came close in 2005 with the Pivot joint venture with Sprint that was abandoned in 2008. Later that year, it invested in WiMax pioneer Clearwire, but ended up selling its interests to, you guessed it, Sprint in 2012, some at substantial discounts.

Not every cable wireless venture went bust. Its investments in WiFi have proven to be a major customer retention tool, ironically as a way to offset high wireless data charges from Sprint and other carriers.

Cable appeared to throw in the towel in 2011 when the SpectrumCo consortium, a group of Comcast, Time Warner Cable and Bright House Networks, sold its wireless spectrum licenses to Verizon for $3.9 billion. That deal included a provision that allowed the parties to activate an MVNO agreement, which Comcast did in October 2016. Charter, which purchased Time Warner Cable and Bright House in May, inherited that MVNO agreement as well.

Comcast and the rest of the cable business are attacking the wireless business at a time when margins are at an all-time low, customer growth has peaked and the two largest players, Verizon and AT&T, have essentially started a price war that will eventually suck in every participant, including cable. Just how long cable would be able to stomach a lengthy price battle — it has vehemently avoided them in the past — is the big question.

Whether this product will be a gateway toward 5G, the newest wireless technology that promises to deliver ultra-fast broadband speeds over short distances, remains to be seen. But for the time being there appears to be some wiggle room, as Comcast will initially test the service with employees and fully roll it out to its footprint by the end of the current quarter. That gives it time to work out any kinks in the service and add any features.

And as is the case with most technological endeavors, there are likely to be kinks. It will be up to Comcast and the rest of the cable industry to make sure those kinks don’t end up strangling what could finally be a lucrative wireless opportunity.

Comcast will host an analyst meeting Thursday to provide information around its planned wireless service launch later this year.

The event and accompanying presentation will be webcast live on Comcast’s Investor Relations website on Thursday, April 6, beginning at 9 a.m. Eastern Time. Senior members of the Comcast leadership team will participate in the event.

RELATED: Rush Toward Unlimited Plans Complicates Cable’s Mobile Moves (subscription required) 

Comcast said last year that it had activated the Mobile Virtual Network Operator agreement with Verizon Communications, part of the SpectrumCo consortium’s sale of wireless licenses in 2011. Comcast created a separate division for the service -- Comcast Mobile – headed by former EVP of sales and marketing operations Greg Butz, in July and has said it planned to launch the service by the middle of this year.

Comcast has kept its mobile plans close to the vest, although chairman and CEO Brian Roberts offered some general details at an industry conference in February.

A pivot to unlimited data plans by all of the nation’s largest cellular service providers is muddling the wireless plans being developed by Comcast and other U.S. MSOs.

AT&T and Verizon Communications, which recently joined Sprint and T-Mobile in offering unlimited mobile data plans, are undermining strategies that some cable operators were pursuing as they look to stitch their ever-expanding WiFi networks to mobile virtual network operator (MVNO) agreements.

Cable operators can put together unlimited plans of their own that use a WiFi-first stance that offloads traffic on metro and in-home WiFi networks and falls back on cellular connections.

“They’re scrambling internally” as other carriers launch and emphasize unlimited mobile plans of their own, an industry source with knowledge about those strategies said.

“The industry’s rush to unlimited certainly complicates things,” Craig Moffett, senior research analyst at MoffettNathanson, said in an emailed statement. “The cable operators will now have no choice but to make their own wireless plans unlimited as well. That’s a problem. Their revenues will be capped. Their costs will not.”

Still absent from the discussion are precise details about how cable operators intend to enter the wireless market, including how those offerings will be priced and packaged and how they will fit into their broader service offerings.

Comcast, which has created a mobile division and intends to launch a mobile offering of its own by midyear, has shed some light on its service, which will take advantage of the company’s MVNO deal with Verizon.

Speaking at an investor conference in late February, Comcast chairman and CEO Brian Roberts said company watchers can expect Comcast’s product to be profitible, but it will launch as part of a bundle.

“The product itself is going to save you money by taking our bundle,” Roberts said, and the wireless product will also help Comcast sell other products in its arsenal.

Last week, FierceWireless reported that the popular iPhone will factor into a service that will carry the Xfinity Mobile brand.

Charter Communications is also looking to take advantage of an MVNO deal it inherited from its merger with Time Warner Cable and Bright House Networks, but hasn’t revealed its go-to-market strategy.

Another person familiar with Comcast’s mobile ambitions said it would be incorrect to think that Comcast’s plan is to take the major mobile carriers head on. Amplifying Roberts’s point, the source said Comcast views the wireless business as additive, a way to enhance and build on its existing product portfolio. “That’s an important nuance,” the source said.

Another industry analyst believes that the surge of unlimited offerings from incumbent mobile giants won’t have a big impact on cable’s efforts to re-enter the market, despite past stumbles like the short-lived “Pivot” joint venture with Sprint.

“It’s another form of bundling,” Bruce Leichtman, president and principal analyst of Leichtman Research Group, said. “It doesn’t have to be differentiated from other wireless services. The differentiator, potentially, is the ability to bundle. That’s where the value lies, not in the mobile service itself.”

Plus, the latest unlimited craze is not occurring to counter what cable operators have in store, according to Jefferson Wang, senior partner, wireless, at IBB Consulting, a firm that works with a range of mobile and cable providers.

It all ties into competition among those carriers, which have no choice but to match up because the market is already saturated.

“A lot of that innovation is coming from the pricing and packaging side, which means unlimited becomes a very enticing offer to consumers,” Wang said.

He also said not to expect uniformity on how MSOs enter the market or how the move to unlimited models will affect them. How those operators jump in and the goals they set will be determined by whether they have a favorable MVNO agreement and what kind of other network assets they already have at their disposal, including fiber and WiFi infrastructure.

“To get into a consumer smartphone/wireless play is a very narrow definition of a very broad opportunity,” Wang said. “I view it more as a launching point.”

Cable operators have a lot of fiber in their networks, but it’s clear that their advantage in WiFi networking assets will be played aggressively.

Comcast, for example, has about 16 million WiFi hotspots deployed in metro and business locations and inside home gateways. At last check, the Cable WiFi roaming consortium, a group that includes Comcast, Cox Communications, Altice and Charter, has deployed about 500,000 hotspots that their respective customers can use.

The amount of data being offloaded on WiFi networks is expected to surge in the next few years.

As of 2016, 63% of all traffic from mobile-connected devices was being offloaded to fixed networks by means of WiFi devices and femtocells each month, according to Cisco Systems’s latest Visual Network Index: Global Mobile Data Traffic Forecast. The same report expects that half of IP traffic — fixed and mobile — will be WiFi by 2021, versus 30% on wired networks and 20% via mobile/cellular.

Wang of IBB Consulting said cable operators must be agile and be ready to make changes quickly in the hypercompetitive and ever-evolving mobile market.

“When you create an entry strategy, things can change,” he said. “You have to make sure you really think through your strategy, but make sure it’s flexible.”

FreedomPop, the company behind a WiFi-first voice and data products, has introduced its own full-featured, low-cost phone for £59 (US$69.77) that will initially be offered in the U.K. and Spain, with plans to introduce it in the U.S. later this year.

RELATED: FreedomPop Raises Global Stakes

FreedomPop has previously relied on refurbished Android smartphones. The new device, called the V7, will give the company more control of its service, gain access to a higher-quality product, and will help FreedomPop deal with supply issues for refurbished Android devices, said FreedomPop CEO Stephen Stokols.

RELATED: Intel Capital Splashes Cash on FreedomPop, Sckipio

He said FreedomPop, which tends to operate in the lower end of the market, has run into supply problems by leaning on refurbished devices that, on occasion, has caused the company to stop promotions prematurely and created a backorder issue.

“There are only so many devices in the market,” he said, noting that FreedomPop’s issue with supply has been ongoing for about 18 months.

By going with its own smartphone, FreedomPop will also get more control of the service and the overall experience, which uses a WiFi-first model that falls back on cellular networks through MVNO deals with carriers, Stokols said.

FreedomPop isn’t naming its initial supplier for the V7, but the company could eventually work with multiple OEM partners, he said.

While acknowledging that FreedomPop doesn’t need the volumes of a company like Samsung, the aim is to take on partners that can produce in the volumes it needs, “and ramp up with us," Stokols said. 

FreedomPop doesn’t disclose exact customer figures, but is approaching 2 million worldwide, according to Stokols. 

Stokols said FreedomPop expects to introduce the V7 to U.S. customers by sometime in the next quarter.

The FreedomPop V7 includes a free FreedomPop SIM that supports free voice, text and data included, as well as free WhatsApp usage. Customers who want more than the basic free plan can either upgrade to a paid FreedomPop plan, use a different SIM, or both, because the phone is dual SIM device.

The phone itself runs Android 6.0 Marshmallow, features a five-inch IPS scree and 13 megapixel camera, and is powered by the Qualcomm Snapdragon 210 processor. It has 8 gigabytes of internal memory and can support 32 GB micros SD card.

Comcast executives held their wireless cards close to the vest Thursday, with chairman and CEO Brian Roberts offering that a product will be launched by the middle of this year but only in bundles.

Comcast has been expected to launch a wireless offering since last year, when the company activated a Mobile Virtual Network Operator (MVNO) agreement with Verizon. The MVNO was part of Comcast’s participation in SpectrumCo consortium of cable operators that sold its wireless spectrum licenses to Verizon in 2011.

Comcast activated the MVNO in October 2015, and last year formalized its wireless commitment by creating a new unit, Comcast Mobile, headed by former sales and marketing EVP Greg Butz.

This isn't the first time Roberts has said a wireless product is coming in mid-2017. But on a conference call to discuss fourth quarter and year-end results on Thursday, the Comcast chief appeared to make it clear that it will only be available in a bundle of video and data service. Any other strategic plans remain under wraps.

“I would characterize our efforts and approach in the following way: One, we plan to include wireless in our multiproduct bundles in a way that is designed to add value to our customers, improve retention, and ultimately benefit lifetime customer economics for us,” Roberts said on the call. “Our offering will give customers access to a world-class wireless network benefiting from our Wi-Fi with the best mobile devices and a simple transparent experience, all for a great value.”

But as analysts continued to press him for more details, Roberts stuck to the script, adding that the goal is to bundle services for customers that want to save on their bills.

“There's only one way to find out and it's to get started,” Roberts said. “We're going to take it very carefully.”

Roberts deflected questions about Comcast’s MVNO relationship with Verizon, adding only that it is “good,” and that the company is excited to be nearing the launch.

“We will learn a lot as we go,” he said.

Despite a handful of mobile virtual network operator (MVNO) agreements by companies to resell wireless service, Verizon Communications executive vice president and president of product innovation and new businesses Marni Walden said the telco has no appetite for its own quad play.

At the Citibank Internet, Media & Telecommunications conference in Las Vegas, Walden seemed to shut the door on a possible combined wireless, voice, video and data product offering. Verizon, through its 2011 purchase of wireless spectrum from cable consortium SpectrumCo, agreed to MVNO agreements with the operators as part of that deal. In the past year, Comcast and Charter have said they have exercised those MVNO rights. Comcast expects to offer a wireless product later this year.

Walden said that concept of the quad play, though popular in Europe — Liberty Global is a big proponent — makes less sense in the U.S. market.

COST SAVINGS IS KEY

Walden said that through Verizon’s customer research, what subscribers most want out of a product bundle is price discount.

“The quad play is overrated in the U.S. unless it is deeply discounted,” Walden said at the Jan. 5 gathering, adding that is something Verizon does not intend to do.

More important is the telco’s fiber network and its plans for a next generation 5G wireless offering.

Verizon CEO Lowell McAdam said last year that the telco could start 5G trials as early as the first quarter of 2017.

5G networks could deliver blinding broadband speeds — up to 10 Gigabits per second, 10 to 100 times faster than traditional wireline data networks.

RELATED: Verizon Touts Progress on Next-Gen FTTP

The first product offering on the 5G platform will most likely be a fixed wireless offering, Walden said, which could take the form of a connected home product or a bundled video offering.

Other telcos have jumped into the 5G fray as well, with AT&T saying it would test a 5G service to deliver its DirecTV Now over-the-top service in Austin, Texas in the first half of the year.

The Austin trial will involve residential customers in the area. It will also include other unspecified next-generation entertainment services and devices and is expected to enhance AT&T’s understanding of the technology. That also includes how the fixed wireless technology handles heavy video traffic, according to a company statement. Some DirecTV Now customers have complained of spotty service after its November launch.

The excitement over 5G is widespread: Charter Communications CEO Tom Rutledge mentioned its potential to deliver speeds of 10 Gbps for cable over hybrid wireless wireline networks in a conference last year. But the service isn’t expected to reach full commercial deployment until 2018 or 2019.

“We’re not waiting until the final standards are set to lay the foundation for our evolution to 5G. We’re executing now,” AT&T chief strategy officer and group president, Technology and Operations John Donovan said in a statement.

Charter Communications hasn’t said specifically when it would begin to offer a service based on the MVNO agreement — Rutledge had said it could come in 2017 or 2018. But the Charter CEO said at the Citi conference last week that he’s confident the cable company can compete, adding that he believes Charter can squeeze 10 Gbps speeds out of its existing coaxial network.

“We’re not only developing coaxial 10 Gbps symmetrical services, but we’re developing new platforms inside the fiber optic network that ensure the backhaul capacity is there to match the coax,” Rutledge said at the Citi conference. “We think we have the best network to build the next generation of wireless services.”

MORE YAHOO SKEPTICISM

Walden also cast some doubt on the future of the Yahoo deal. Yahoo revealed in December a second data breach — this time of about 1 billion email accounts — which Verizon is currently investigating.

Walden said the fundamental reason for the merger still exists — to build scale.

“This is really about taking the audience from hundreds of millions to the billions,” Walden said. “That still remains important to us.”

The investigation continues, she added, noting that several questions need to be answered, including whether there have been any changes to the Yahoo asset.

“With time we will have answers to those questions,” Walden said. “We will be very responsible about what we do to make sure we are getting the value out of the assets and doing the right thing for our shareholders.”

Charter Communications chairman and CEO Tom Rutledge said the cable operator is moving toward a future where broadband speeds of up to 10 Gigabits per second are possible, but stopped short of pinpointing exactly when that future will be.

At the UBS Media and Communications conference in New York, Rutledge pointed to the cable operator’s current MVNO agreement with Verizon, which he said could take hold in late 2017 or 2018. But building on that deal – which would allow Charter to resell a Verizon wireless service under its own brand – would be an even faster wireline service that Rutledge said could open up a “whole new industry.”

Rutledge said there are already about 200 million wireless devices connected to Charter’s wireline network and about 80% of the bits on a mobile company’s network travel through that same network.

“We are a wireless company,” Rutledge said.

Charter has already exercised its Verizon MNVO rights, part of the SpectrumCo sale of wireless licenses to Verizon in 2011. Comcast also has said it exercised those rights.

Charter currently offers data speeds of up to 100 Megabits per second in most of its markets and its minimum speed is 60 Mbps. Other operators have offered 10 Gbps download speeds in select areas, and symmetrical 10 Gbps is part of the “Full Duplex” enhancement to the DOCSIS 3.1 standard. The spec for the Full Duplex extension is expected to be completed sometime in 2017. However, commercial deployment probably won't begin until 2018 or 2019.

At the UBS conference, Rutledge said MVNOs have their limitations, but with future technologies on the horizon like 5G wireless – he said Charter has applied for experimental licenses for testing that technology – the possibilities surrounding hybrid wireline and wireless networks are endless.

“I think we’ll begin to move toward building out a 10 Gigabit symmetrical infrastructure that is ubiquitously deployable across our footprint at fairly low capital investments relatively to anybody else,” Rutledge said. “…We can attach wireless devices to that high-capacity wireline network in a way I don’t think anybody else can do at the same level of capital efficiency and get tremendous throughput, low latency, high compute networks that bring the possibility down the road to a whole new industry essentially.”

Comcast chairman and CEO Brian Roberts didn’t offer any new news regarding the cable operator’s plans to launch a new wireless product next year, but added he thinks it will be a money-maker.

Comcast said last month that it expected to launch a wireless offering by mid-2017, building on its mobile virtual network operator (MVNO) agreement with Verizon Communications.  Comcast has been tight-lipped about what that product will be, but has formed a Mobile division, tapping former EVP of sales and marketing operations Greg Butz to spearhead the effort.

On a conference call with analysts Wednesday (Oct. 26) to discuss third quarter results, Roberts said there was no new news to offer on the product. 

“We fundamentally believe we can make money for the shareholders through a wireless offering with the unique relationship we have with the Verizon MVNO,” Roberts said. “We have the ability to do things that we believe make that statement come true and can create real value for shareholders along the way.”

Related:NBCU’s Burke: ‘Healthy Skepticism’ That OTT-TV Will Draw Subs by the Millions

Comcast Cable CEO Neil Smit added that other operators – particularly Rogers Communications, Telenet and Virgin Media – have used wireless to reduce churn and increase the customer’s lifetime value.

“In a way we’re already in the wireless business,” Smit said. “We deployed millions of wireless gateways and the WiFi service in the household is the fastest in the market. I think by leveraging [Comcast’s] 28 million customer relationships, the 15 million hotspots and the MVNO we can offer a really excellent service.”

Verizon Communications added about 36,000 Fios TV customers in the third quarter, reversing a loss of 41,000 video customers in Q2 spurred by a six-week strike over the summer, while it tried to calm  investors worried about its wireless resale agreements with cable operators and its pending $4 billion purchase of Internet icon Yahoo.

The Fios TV growth was expected – analysts’ consensus estimates were for 28,000 additions. The telecom company also added about 90,000 Fios Internet subscribers in the third quarter, outpacing analysts’ expectations of 62,000 additions.

Verizon chief financial officer Fran Shammo, who announced his intention to retire at the end of the year, fielded questions from analysts about its wireless Mobile Virtual Network Operator (MVNO) agreements with Comcast and Charter. Comcast said it activated its MVNO deal last October and plans to have a wireless product by the middle of next year. Charter Communications, which had Verizon MVNO rights via its purchase of Time Warner Cable in May, said it too has activated those rights.

The MVNO deal are the result of the 2011 sale of wireless spectrum by SpectrumCo (which included Comcast, Time Warner Cable and Bright House Networks).

An MVNO would allow Comcast and Charter to basically resell Verizon’s wireless service under their own brand. It would also allow them to utilize the Verizon wireless infrastructure for a hybrid cellular-WiFi offering.

In a research report just prior to Verizon’s release of Q3 results Thursday, MoffettNathanson principal and senior analyst Craig Moffett wondered if the MVNO deal gave an advantage to the cable operators, by allowing them to offer a similar quality service at a reasonable price.

Moffett continued that it is more likely that the MVNO deal could lead to a later alliance between cable and Verizon.

“Wouldn’t the simplest reading instead be that the MVNO agreement speaks to building bridges, not moats?” Moffett wrote.       

An alliance could have obvious advantages – Verizon could profit from cable’s imbedded wireline infrastructure and the cable companies could benefit from Verizon’s best in class wireless service.

Shammo, in what is likely to be his last quarterly earnings call at Verizon, said its eyes were open when it did the deal severbal years ago.  

“This is a wholesale agreement, and as Lowell [McAdam, CEO] and I have repeatedly said we would do the agreement again today if we had to. It’s a good agreement for V W— it’s a wholesale agreement,” Shammo said. “I can’t speak to the economics of what they’re going to do. The wireless pie continues to grow, everyone wants to get a piece of this pie, [and] the industry itself will continue to grow around that pie. It’s not like I believe the industry with the carriers will lose share to anyone. I just think there’s going to be more opportunity for growth.”     

While the wireless pie gets bigger, analysts and investors are wondering whether the purchase price of Yahoo may shrink. Verizon agreed to buy the Internet search icon in July for $4.8 billion, but that was before Yahoo revealed it had been the target of a massive data breach. In September, Yahoo said more than 500 million accounts had been hacked, including customer addresses and passwords. The scope and cost of the breach is still to be determined, but some have speculated it could result in Verizon shaving as much as $1 billion from the purchase price.

Shammo reiterated Verizon’s earlier statement that it believed the breach could be a material event, but said the companies’ lawyers were just starting to look into it.

“We are still evaluating what it means for this transaction. This was an extremely large breach that has received a lot of attention from a lot of different people. We have to assume it will have a material impact on Yahoo,” Shammo said, adding that lawyers had their first call about the matter Oct. 19.

“From what I understand, that's going to be a long process," Shammo continued. “Unless Yahoo comes up with different processes, it’s going to take some time to evaluate this. Until then, we haven’ t reached any final conclusions around this issue.”    

Charter Communications could be the next cable operator to test the wireless waters, informing Verizon Communications of its intention to invoke its Mobile Virtual Network Operator (MVNO) rights with the carrier.

Charter chairman and CEO Tom Rutledge said a wireless product is in the company’s future, but gave few details at the Goldman Sachs Communacopia conference Wednesday.

“We have told Verizon we’re interested pursuing that MVNO agreement and we are in the process of effectuating it. We’d like to pursue that relationship, and we’ve talked to other companies about MVNOs,” Rutledge said at the conference.

The Charter revelation comes on the heels of Comcast chairman and CEO Brian Roberts’ announcement earlier in the week that it would launch a wireless product in mid-2017, utilizing its own Verizon MVNO agreement. Comcast received those MVNO rights as part of SpectrumCo’s sale of wireless spectrum to Verizon in 2011. Comcast invoked those MVNO rights last October.

Charter wasn’t part of the SpectrumCo consortium, but it recently closed on the purchase of two former members – Time Warner Cable and Bright House Networks. It was widely believed that Charter would exercise those MVNO rights.

Just what Charter will do in the wireless field remains to be seen. Rutledge didn’t give many details but he did acknowledge that the video business was becoming increasingly mobile.

“To get from where we are to true mobility is going to require the use of our Wi-Fi [network], it will require the relationships we have with MVNOs, and it’s going to require us to actually build out [our] network at some point in the future,” Rutledge said.

Rutledge said the MVNO alone is primarily a traditional smartphone technology platform, not deeply integrated and has its limitations.

“From a value proposition, if you package and price it properly and you can get an appropriate wholesale discount so you can do that with a little bit of margin, you can drive your penetration much deeper,” Rutledge said.

Charter, he said, has about 50 million homes passed and about 25 million subscriber relationships. But the 25 million non-customers within the footprint “is our upside. To the extent mobility can help us drive that, the economics of filling in your penetration from an ROI perspective are fantastic,” Rutledge added.  

Comcast chairman and CEO Brian Roberts said the country’s largest cable operator is preparing to launch a wireless product by the middle of next year, integrating its WiFi service with Verizon Wireless mobile technology.

Roberts, speaking at the Goldman Sachs Communacopia conference in New York didn’t offer many details on the wireless offering, adding that it will be targeted at Comcast’s best customers – those that take at least two services from the cable operator.

“The concept would be that our very best customers, of which we have 28 million, and well over 70%- to -80% bought some sort of multi-package from us, we can sell them more products,” Roberts said. “And if that product can be the Verizon wireless product, maybe improved with our 15 million WiFi hotspots where its more seamless, and we are able to give you a good value proposition, we believe there will be a big payback, with red churn, with more stickiness, with better satisfaction, more product purchasing from us. We’re excited to be working toward that.”

Comcast exercised its mobile virtual network operator (MVNO) agreement with Verizon – part of its 2011 sale of wireless spectrum to the company – last year. In July, Comcast created Comcast Mobile, headed by former EVP of sales and marketing operations Greg Butz, to investigate the wireless opportunity.

Comcast has ventured into the wireless business in the past with mixed results. But the company says this time it is taking a cautious approach.

“We want to do it right and we want to do it well,” Roberts said.

Comcast also is taking its time regarding offering smaller video packages, so-called skinny bundles,  that several other pay TV and over-the-top providers have embraced.

At the conference, Roberts wasn’t convinced that smaller is necessarily better.

“I don’t know if that’s really what people want,” Roberts said of skinny bundles. “There’s certainly some who want to pay less, but I don’t know too many programmers who are saying ‘I want to go a la carte and it works for my business.' But we’re experimenting and there are clearly some customers who are saying therefore I won’t buy at all.”

Roberts added that about 30% of Comcast customers that take smaller video packages eventually upsell to a fuller offering. He noted that Comcast has begun adding video customers in the past 12 months, “We’re not going backwards,” Roberts said. “Our focus is to continue to make the bundle more valuable.”

Comcast reinforced its commitment to a wireless product last week after naming longtime executive Greg Butz to head up its new Comcast Mobile division, a unit that could be the next step in the cable company’s journey toward offering customers full mobility.

The move, part of broader changes including the departure of chief network officer John Schanz and cable division chief financial officer Cathy Avgiris (see sidebar), comes about eight months after Comcast notified Verizon Communications last October of its intention to activate its Mobile Virtual Network Operator agreement with the carrier.

The MVNO agreement, part of the deal by SpectrumCo (a consortium of Comcast, Time Warner Cable and Bright House Networks) to sell its wireless licenses to Verizon for $3.9 billion in 2012, would essentially allow Comcast to resell Verizon wireless service under its own brand name, a dramatic change from its past endeavors in the wireless business.

Comcast has been part of wireless partnerships that all went bust: Sprint PCS and Pivot with Sprint; and one with WiMax pioneer Clear-wire. An MVNO would allow Comcast to resell a reliable service with lower upfront costs.

Selecting Butz to head up the group was no accident. As executive VP of sales and marketing, Butz has been a key part of Comcast’s sales success, and past wireless endeavors have lacked a strong marketing component, according to some people familiar with the company.

“Selling to the base is going to be critical, and Greg [Butz] knows how to sell into Comcast’s customer base,” one source said.

Butz helped create Comcast’s broadband business in the early days of high-speed data, responsible for product strategy, business strategy and marketing. He also has a cellular business background, serving stints at Comcast Cellular and Bell Atlantic Mobile.

Comcast declined to comment on the Comcast Mobile unit, but sources familiar with the company said its formation is a logical next step in what may be a slow and steady process. Comcast Cable CEO Neil Smit has said publicly that the cable operator was in “test and learn” mode concerning its wireless plans, and that still appears to be the case.

“I expect Comcast to go about this pretty slow,” Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said, adding that it could be one to two years before Comcast unveils a product.

While Comcast isn’t letting on what that could be, most analysts believe a hybrid WiFi-cellular phone could be first out of the gate — a mainly WiFifirst phone that hands off to the cellular network when the customer leaves a hotspot. It could give Comcast the ever-elusive quad play of video, wireline voice, data and wireless that operators have chased for decades.

The timing is better now than in the past, Wlodarczak said, for two reasons: Wireless pricing is high and wireless usage is off the charts.

Wlodarczak said offering a service over an already reliable wireless network at a cheaper price could gain traction. However, operators would have to be careful as to how low they go.

“If you really only need the MVNO as a fill-in — the tech is not quite there yet — you could seriously squeeze the telcos using their own network,” he said. “But this is the flaw with MVNOs; at some point the deal ends.”

Sprint Corp. is cutting 2,500 jobs, roughly 7% of its workforce, according to multiple media reports.

The reduction comes amid the wireless carrier’s plan to reduce costs by as much as $2.5 billion, a move that will also involve the closing of several call centers, according to Bloomberg, adding that word of the reduction was delivered to employees on Friday (January 22).

The cuts include 574 jobs at Sprint's Overland Park, Kan., headquarters, per CNBC. The Kansas City Starfirst reported of the layoffs

“We are in the process of significantly taking costs out of the business so the transformation of the company will be sustainable for the long-term,” the company said in a statement to Bloomberg. “We are leaving no stone unturned as we work to eliminate up to $2.5 billion of costs from our business. Unfortunately, as we’ve said over the past several months, the effort to reduce our costs would impact all areas of our business, including jobs.”

Sprint also announced fiscal Q3 results on Thursday, announcing net operating revenues of $8.1 billion, down 10% year-over-year, but up 2% versus the previous quarter.

Sprint also posted a net loss of $836 million (21 cents per share), narrowed from a year-ago loss of $2.4 billion (60 cents per share).

Spring said it added a net 366,000 postpaid phone subs in the quarter, and that postpaid churn for the period, at 1.62%, was its lowest ever for a third quarter. Total net adds in Q3 were 491,000, down from 967,000 in the prior year quarter.

In November, Sprint hatched a promotion that offered 50% off to AT&T, T-Mobile and Verizon Wireless customers who switched to Sprint.

“It’s clear from our quarterly results that we are making great progress on achieving our goals,” said Sprint CEO Marcelo Claure, in a statement. “Revenue has stabilized, costs are coming out faster than expected, postpaid phone net additions were the highest in three years, postpaid churn was the lowest-ever for a third quarter, and the network is performing at best-ever levels.”

Last month, Comcast chairman and CEO Brian Roberts said his company was talking to wireless carriers, including Sprint, about possible agreements for a hybrid WiFi-cellular phone product. Comcast activated its Mobile Virtual Network Operator (MVNO) agreement with Verizon in October. Comcast also has an MVNO agreement with Sprint. 

FreedomPop, a startup that targets mobile voice and data services to cost-conscious consumers, said it has raised $50 million more  while introducing a new “global” hotspot.

The new round of funding, which takes its total beyond the $109 million mark, will be used to stoke growth and accelerate its international expansion.

The new global hotspot (pictured) is supported in 25 countries today, and will approach 50 by year-end, as it expands into parts of Asia and Latin America.

FreedomPop is selling the hotspot for $49.99, and offering a global SIM for smartphones for $10. The data plan includes 200 megabytes per month in the supported countries, and customers can buy additional 500 MB buckets of data for $10.

That hotspot will initially help customers connect in the U.S., United Kingdom, France, Germany, Italy, Spain, Switzerland, Austria, Netherlands, Belgium, Luxemburg, Sweden, Finland, Norway, Denmark, Ireland, Portugal, Greece, Poland, Hungary, Slovakia, Croatia, Romania, Bulgaria and Czech Republic. FreedomPop plans to expand coverage to over 40 countries by year end including parts of Asia and Latin America. Countries on the coming soon list include Brazil, Hong Kong, India, Mexico, Russia and Vietnam, among others.

FreedomPop CEO Stephen Stokols said the company is able to offer access and pricing lower than roaming rates thanks to MVNO partnerships in each market.

“We’re doing all these deals with the intent to launch locally,” he said.

He added that the new products aren’t necessarily targeted to world travers, but to consumers in those markets that are trying to avoid more expensive roaming rates.

Stokols noted that some carriers are also looking to forge strategic partnerships with FreedomPop that could enable them to enter new markets.

FreedomPop said it has signes on  more than 1 million subs so far. 

Comcast chairman and CEO Brian Roberts said the cable giant is talking to wireless carriers in addition to Verizon Communications – including No. 3 carrier Sprint – about possible agreements for a hybrid WiFi-cellular phone product.

Comcast activated its Mobile Virtual Network Operator (MVNO) agreement with Verizon in October, and according to reports, Roberts said at the Business Insider Ignition conference Tuesday the cable company is speaking with other carriers about forging a similar relationship. 

Comcast’s Verizon arrangement is part of the 2011 sale of spectrum by a consortium of cable operators including Comcast, Time Warner Cable and Bright House Networks called SpectrumCo to Verizon for $3.9 billion. As part of the deal, the SpectrumCo parties had the right to resell a wireless product under their own brand using Verizon’s network. But according to Comcast, once Verizon is notified of the intent to invoke the MVNO option, it would take at least six months before a product could be launched.

Comcast has kept its wireless plans close to the vest. According to Bloomberg News, asked at the conference if the cable giant might sell phones in conjunction with a wireless offering, Roberts answered “we might.”

“We have been looking at our relationship with Verizon, and Sprint and others where we have the right to wholesale the network and marry it with our Wi-Fi,” Roberts said, according to Bloomberg. “We’re going to experiment in that area.”

Cable’s WiFi-cellular prospects got a shot in the arm last week with news that the largest U.S. cable operator is making moves that could lead to a hybrid WiFi-cellular phone and data product.

Comcast wouldn’t say what, when or even if a wireless product would come to life, but it’s putting together the pieces. The first step was to exercise a MVNO (mobile virtual network operator) option with Verizon Communications, and Comcast is planning to begin evaluating a potential offering in about six months.

“We believe that wireless obviously is an important area for consumers,” Comcast chairman and CEO Brian Roberts said during the company’s third-quarter earnings call. “We are going to trial some things, we are going to test some things after we activate and we’ll update people as that progresses. But it’s an opportunity to take the network and the successful investments that we’ve made, and try and see if we can continue relationships and product innovation that the team is working on.”

One of those successful investments was SpectrumCo, a consortium that also included Time Warner Cable and Bright House Networks and which sold wireless licenses to Verizon for $3.6 billion in 2012. The MVNO rights spring from that sale.

CHARTER, TWC ON DECK

Comcast might not be alone in its wireless aspirations, MoffettNathanson principal and senior analyst Craig Moffett said. Charter Communications, which is in the process of purchasing both Time Warner Cable and Bright House, believes the MVNO rights are transferable and has expressed a desire to at least entertain the idea of a quad-play service.

Charter and Comcast could partner on a service, Moffett said in a note to investors, and jointly bid for broadcast spectrum. That would make economic sense but would likely draw an unfavorable reaction from regulators.

A WiFi-first phone and data product — one that uses the cable company’s WiFi network and hands off to the traditional cellular network to round out coverage — could be the answer to the elusive quad play of video, voice, data and wireless.

In the past, cable operators have tried their hand at offering a wireless product, through failed partnerships with Sprint and Clearwire. But this time may be different. The popularity of cable WiFi products, the low cost of the spectrum and the growth of mobile video could make a WiFi-first offering a success.

Adding to the urgency are recent moves by cable’s telco competitors. AT&T, which completed its $48.5 billion merger with DirecTV in July, has pushed heavy discounts for wireless and video service. Verizon, which already has about 5 million subscribers to its wireline FiOS TV product, also launched a free, ad-supported mobile-only video service — go90 — to limited audiences.

Cable companies have spent years building their WiFi networks. Cablevision Systems, which in September agreed to be acquired by European telco Altice, was the first, committing about $300 million to a WiFi buildout.

Other operators were later to the game but have stepped up efforts in past years.

But WiFi remains mainly a broadband retention tool except in the case of Cablevision, which launched Freewheel, a $9.95 per month WiFi-only phone and data service, in February.

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said a wireless play makes sense for cable operators that have already ramped up their WiFi offerings. “Why not offer consumers a low-end add-on wireless service that defaults to the WiFi network initially and then uses an MVNO to fill in the blanks?” he asked.

With about 80% of wireless data usage occurring in the home or office — two areas where cable is uniquely positioned — there is a high potential to offer a low-cost wireless service, as cable did with wireline phone service.

SPECTRUM AUCTION NEXT?

Moffett said he believes Comcast’s MVNO decision is the first in a series of dominoes to fall. The next could be its participation in the upcoming 2016 broadcast-TV spectrum auctions.

Bidding on and winning the lower-frequency broadcast licenses would allow Comcast to offer a service that would use WiFi in more populated areas and low-frequency spectrum in less dense locations.

On the earnings call, Roberts said Comcast hasn’t decided if it will bid on spectrum, saying it doesn’t feel the need for “owner’s economics” in a wireless offering. (Comcast-owned NBCUniversal expects to participate in the auction as a seller, Roberts also said.)

Whatever Comcast decides to do, they will be just the first steps in “what is likely to be a rather long and slow evolution,” Moffett said.

NUMBERS: Hot to Trot

Cable companies have been beefing up their WiFi networks, substantially increasing the number of hotspots available to their customers.

Company               No. of Hotspots
Comcast . . . . . . . . . . .11.7 million *
Cablevision . . . . . . . . . 1.1 million *
Time Warner Cable. . . . 400,000 +
Charter . . . . . . . . . . . . . . . N/A

* Includes indoor, outdoor locations in hotspot numbers
+ Per Cable WiFi Consortium, which includes Comcast, TWC, Bright House Networks, Cox and Cablevision

SOURCE: Individual companies, published reports

Comcast chairman and CEO Brian Roberts took the roundabout way in admitting the nation’s largest operator has exercised its wireless MVNO option with Verizon Communications, adding that it is likely its NBC broadcast unit will participate the upcoming spectrum auctions.

On a conference call to discuss third quarter results, Roberts said that Comcast believes wireless is an important area for the company and stressed that it takes six months after exercising the option to activate the MVNO.

“We’re going to trial some  things and test some things after we activate and we’ll update people as that progresses,” Roberts said. “But it’s an opportunity to take the network and the successful  investments we’ve  made and try to see if we can continue relationships  and product  innovation that the team is working on.”

The MVNO agreement stems from the 2011 sale of wireless licenses owned by SpectrumCo, a consortium that included Comcast, Time Warner Cable and Bright House Networks, to Verizon for $3.6 billion. The MVNO agreement allows the cable operators to resell Verizon wireless service in their footprint.

Cable division CEO Neil Smit added that there is nothing new to report.

“We’re in test and learn mode,” Smit said.

Verizon chief financial officer Fran Shammo said during an earnings conference call Oct. 22 that one of the cable companies has exercised the MVNO agreement, but declined to identify it. Comcast had been said to been talks with Verizon about the MVNO deal and was largely believed to be the cable company that exercised the option.

Some analysts had believed that exercising the MVNO agreement meant that Comcast also would participate in the upcoming federal broadcast spectrum auctions, using those additional licenses to fill out areas the MVNO does not cover. On the call, Roberts said its NBC broadcast unit plans to participate in the auction, but as a contributor of spectrum not a buyer.

Still, Roberts left the door slightly ajar that the cable unit could participate in the auctions. But Roberts said that the cable giant does not feel the need to own the network.

“We’ve always felt it’s part of a product set, I don’t think we feel that we have to necessarily in any way seek owner’s economics,” Roberts said. “On the NBC side we intend to participate. On the cable side it’s something we will continue to study.”

Comcast dropped impressive hints this week that it plans to leverage its fast-growing WiFi capability and its extensive Mobile Virtual Network Operator (MVNO) agreements to plunge into the increasingly competitive world of mobile video.

At Goldman Sachs' Communacopia conference on Wednesday (Sept. 16), Comcast Chairman and CEO Brian Roberts stopped short of providing any specific timetable but said, "We're thinking we are very much part of this conversation on a go-forward basis."

Roberts acknowledged that Comcast has added about a million public WiFi hotspots around the country in the past few months, an increase of 10% over the 10 million hotspots in place at the end of the second quarter in June. He called the established WiFi base "an asset of the company."

"We are working on ways to take our WiFi, our 11 million hotspots, our MVNO relationships" into the "competitive space" of mobile video, Roberts said.

He cited Apple's recently announced plan to lease smartphones as an example of "plenty of activity around us." But Roberts stopped short of mentioning Verizon Wireless' soon-to-debut Go90 mobile video service, or the T-Mobile/Bright House WiFi hotspot video test.

Also looming in the future (at least three to five years away) are broadcast TV visions of mobile reception via the evolving ATSC 3.0 standard.

Roberts jabbed at Verizon and Apple by noting, "We haven't seen [their] announcements in action yet." He reiterated his view that wireless ventures "work better on WiFi, and peoples' bills don't go up."

"We are hopeful that as people make decisions, they are going to want our WiFi and our [programming] relationship, our broadband as part of that," Roberts said. "If we can enhance that by someday having an offering, we will see.

"We will have more to talk about down the road," he added. "It is an area that I think we can create value for our shareholders and give more value to the consumers."

Elsewhere in his conversation with Goldman Sachs analysts, Roberts addressed the mobile issue in remarks about increasing program costs, citing opportunities to spread costs across multiple platforms.

"We continue to want to add more capabilities, more wireless rights, more out of home rights, more ease-of-use, more back seasons, more episodes, so that [when] you buy a subscription it's really clear what you get," Roberts said.

Comcast's attention to WiFi and out-of-home video coincides with this week's Ooyala forecast that by the end of this year about half of all online video starts will come via mobile devices. Ooyala said smartphone viewing currently outranks tablet viewing by an 8:1 ratio.

Roberts' remarks about WiFi and mobile video followed his emphasis on Comcast's improvements in broadband, cable and content offerings driving some of its best results in nearly a decade.

Exactly one year ago the Comcast top executive offered similar WiFi drum-thumping remarks at a Bank of America Merrill Lynch Media Communications and Entertainment conference.

Freewheel, Cablevision Systems’ new WiFi-only phone service, is currently limited to the Android-powered Moto G smartphone, but could soon be marketed as a paid app on a broader array of devices, including Apple iPhones.

Cablevision is developing a paid Freewheel app that could launch later this year, Gregg Seibert, Cablevision’s vice chairman, said Monday at the Deutsche Bank’s Media, Internet & Telecom Conference investor conference.

Seibert didn’t reveal an exact launch date or expected pricing on the app, but said the idea of a paid Freewheel app is “something that I think is another way of trying to differentiate the network and get away from all the hyperbole around price.”  Rather than focusing on a $79.99 per month triple play with a Visa card attached to it, “we’re trying to shift that dialogue. But, certainly, consumers still do react to price.”

Freewheel, he added, “should really help to highlight the value of WiFi to our customer base.”

Cablevision’s Freewheel service went live on February 5, available to the MSO’s high-speed Internet customers for $9.95 per month and $29.95 per month for everyone else.  Cablevision offers the Moto G for the partially-subsidized price of $99.95.

Siebert, pressed on why Cablevision opted to start with a WiFi-only service rather than tying it to cellular via an MVNO relationship, reiterated the position that Freewheel is positioned as a data/video product, and that voice will be one of the least-used features of the phone.

In that light, “there really isn’t a need for an MVNO…We’re not actively considering an MVNO at this point.”

But he later acknowledged that there’s “always the possibility that our offering will evolve, but right now we’re comfortable with the WiFi-only nature of the product.”

Cablevision has not announced any subscriber figures for the new product, but Siebert said the operator has been selling units outside the confines of its cable systems.

“We’ve had orders from a number of areas that actually fairly far from our footprint,” he said, later noting that Freewheel will be one of several new WiFi-facing initiatives coming from Cablevision.

As for Cablevision’s WiFi buildout, that’s a top priority for the cable operator, as the plan is to build it out to the point that “it’s virtually ubiquitous within our footprint.”

Google continues to cast its net further and wider afield, this time by forging a wireless partnership with mobile carriers Sprint and T-Mobile U.S. that could allow it to offer its own direct-to-consumer service.

Reports that the company was considering a wireless offering sent Google’s stock up 3.2% ($16.35 each) on Jan. 22 to $534.39 per share. While Google hasn’t officially announced plans for a wireless service, published reports citing people familiar with the matter said it would likely involve a mobile virtual network operator (MVNO) agreement with Sprint and T-Mobile, whereby Google would use the carriers’ networks to offer a wireless service. The reports speculate it could be offered at first in select markets, perhaps as an adjunct to Google’s ultra-high-speed Internet service Google Fiber.

Google spokeswoman Lauren Barriere said it is the company’s policy not to comment on rumor and speculation.

Whatever the outcome, a wireless offering from Google would be another example of the search giant sticking its thumb in the eye of yet another industry. In just the past few years, Google has taken aim at several diverse businesses, including cable, with Google TV and Google Fiber; wireless handsets, with its acquisition of Motorola; and online retailer Amazon, with its 2013 launch of same-day delivery service Google Shopping Express (now Google Express), all with varying levels of success. Google could also be positioning itself to further solidify the dominance of its Android operating system — already installed on more than half the smartphones in the U.S. — but that will only be proven over time.

In a note to clients, Sanford Bernstein telecom analyst Carlos Kirjner and Paul de Sa said it was hard to imagine why Google would make the leap into the highly competitive wireless market via an MVNO, adding that it was unlikely it would compete on price. He added that pairing a wireless service with Google Fiber — currently in three markets (Kansas City; Austin, Texas; and Provo, Utah) and expanding to nine market areas in the future — would limit the product’s reach.

“We don’t see how Google could or would create a distinctive offer for its own MVNO to a large enough customer segment to matter based on service quality, service features, distribution or pricing,” Kirjner and de Sa wrote. “Our current view is that if the MVNO materializes, it will probably be immaterial for Google and for the wireless carriers.”

Google Pass

Whether it decides to offer its own wireless MVNO in the immediate future, Google has a long history of testing the waters in businesses outside its traditional search-engine operations:

Google Fiber: 1 Gigabit-per-second, fiber- 0based high-speed data and pay TV service currently in Kansas City; Austin; Texas; and Provo, Utah. Plans to expand to nine metro areas and 34 additional cities.

Google Express: Same-day retail delivery service launched in 2013. For a daily, monthly or annual fee users can order groceries, apparel and other goods from various retailers.

Google Glass: The first wearable computer, Google stopped production of the prototype in this month but remains committed to the product.

Motorola Mobility: Google purchased Motorola’s cellphone unit in 2012 for $12.5 billion, in part to gain access to its handset manufacturing capability. It sold the handset business to Lenovo in 2014 for $2.9 billion, one year after it sold Motorola’s cable-focused Home business to Arris for $2.35 billion.

SOURCE Company and published reports

As the Canadian government readies hearings next week that could substantially reduce roaming rates for cellular telephone service, Montreal-based cable operator Cogeco Cable – which also has interests in the U.S. cable market – is contemplating creating its own wireless service for its customers.

Cogeco Cable already offers TV, Internet and landline phone service in Quebec and Ontario. In 2012, Cogeco purchased U.S. cable operator Atlantic Broadband in a deal worth about $1.36 billion.

In a statement, Cogeco said it would consider offering its own wireless service if the Canadian government manages to cut prices wireless networks charge to lease their lines. CEO Louis Audet has proposed creating a mobile virtual network operator (MVNO) which would buy network airtime from carriers and resell it to customers.

“Given the high concentration in the Canadian mobile wireless market, Cogeco strongly believes that regulatory measures fostering the entry of MVNOs in addition to other measures will increase competition in the market and enhance consumer choice,”Audet said in a statement. “A regulated MVNO option would definitely be in the best interest of Canadian customers and businesses.”

The Canadian Radio-television and Telecommunications Commission (the chief communications regulator in Canada, similar to the Federal Communications Commission in the U.S.) is scheduled to begin hearings on possibly regulating wholesale roaming rates next week. Cogeco is slated to testify before the CRTC on Sept. 29.

The regulatory agency has pushed for a fourth wireless competitor in the market to compete with Telus Corp., BCE Inc., and Rogers Communications, but hasn’t had much success. The three carriers currently control more than 90% of the wireless market in Canada, and Cogeco believes an MVNO, which would not have to spend the billions of dollars to build its own network, has a better chance of success.

In the U.S., the wireless business has been an elusive one for cable, dating back to the industry’s original partnership with Sprint PCS. Sprint, Comcast, Cox, Time Warner Cable and Bright House Network tried to partner again on a wireless service, called Pivot, which was abandoned in 2008.  In 2011, as part of its agreements to sell its wireless spectrum to Verizon Communications, Comcast, TWC and Bright House negotiated the right to co-market Verizon Wireless service with their cable packages. Cox, which didn’t sell its wireless spectrum in that deal, sold some of its licenses to Verizon later that same year, about a month after abandoning plans to build its own wireless network.