Cox Pulls Plug On Wireless Service

After three years of investment and development, Cox Communications is extricating itself from the wireless business, with the MSO announcing late Tuesday that it will stop selling mobile phone and data service effective immediately.

Cox said it will continue service for its wireless customers -- provided through a wholesale deal with Sprint Nextel -- through March 30, 2012. The company said it will make "special offers" available to Cox Wireless customers to shift to another wireless provider.

In a statement, Cox said the decision to no longer sell 3G wireless service was "based on the lack of wireless scale necessary to compete in the marketplace, the acceleration of competitive 4G networks as well as the inability to access iconic wireless devices."

The "iconic wireless devices" apparently are iPhones, Apple's best-selling smartphones, which had been exclusively available through AT&T before becoming available this year through Verizon Wireless and Sprint.

Cox had launched wireless service in less than 50% of its footprint, including in: Hampton Roads, Roanoke and Northern Virginia; Orange County, San Diego and Santa Barbara, Calif.; Omaha, Nebraska; Oklahoma City and Tulsa, Okla.; and Rhode Island and Cox communities in Connecticut and Cleveland, Ohio.

"Cox is working to make this transition as seamless and easy as possible for our customers," Cox executive vice president of product development and management Len Barlik said, in a prepared statement. "We are proud of our employees' dedication to delivering the excellent customer service that Cox is known for, and we will continue to keep our wireless customers' satisfaction a top priority during this transition period."

Cox announced an ambitious plan in the fall of 2008 to deliver its own 3G, and to build its own wireless network in certain markets. In May 2011, Cox scrapped plans to build its own towers, announcing that it would instead rely solely on Sprint's 3G network.

Previously, Cox was part of the failed Pivot mobile-phone venture with Sprint, Comcast, Time Warner Cable and Bright House Networks. In April 2008, two and a half years after the joint venture was formed, Cox and the other MSOs pulled the plug and stopped selling the mobile-phone service.

In 2009, Cox president Pat Esser said the MSO's new approach was different, because it could better control the billing, provisioning and pricing of its own service as compared with the Pivot joint venture. "We think it's important as a communications provider to offer wireless," he said at the time. "Our current customers and our next generation of customers are telling us they want and need mobility as part of their life."

Cox had marketed the wireless service -- first launched in November 2010 -- emphasizing a money-back offer for unused monthly minutes offering customers a credit of up to $20, with the tagline, "Unbelievably Fair."

The MSO also offered subscribers with at least two services one free upgrade, dubbed the "Bundle Benefit," when they added wireless, including: the Cox Movie Pak, which includes Encore, Epix, Sundance and Vutopia; an upgrade from Preferred to Premier high-speed Internet service; or unlimited domestic long distance calling on their Cox Digital Telephone service.

On Tuesday, Cox said all Cox Wireless customers will receive a $150 credit on their bill for every line of wireless phone service disconnected and that all early-termination fees will be waived. The MSO also said wireless customers will continue to receive their Bundle Benefit promotional services for two years.

"We understand the importance of wireless to the customer experience," Barlik said in a statement. "Cox is looking at several options to continuously increase the value of our bundle of services."