Cox Communications poised to launch wireless service
NEW YORK - Cable TV provider Cox Communications Inc. was set to announce today that it plans to have its own cellular network up and running next year, a move that intensifies cable's competition with phone companies.
Cox had signaled an interest in building a wireless network by spending $550 million on licenses to use the airwaves. But such spectrum purchases don't always lead to the building of a network, and privately held Cox hasn't previously detailed its plans.
The Atlanta-based company plans to build its own network in its cable service area, and partner with Sprint Nextel Corp. for roaming outside those areas.
Cox's spectrum licenses cover the areas around Atlanta, New Orleans, San Diego, Omaha, Neb., and Las Vegas as well as much of Kansas and southern New Mexico. Those areas have about 23 million people, said Stephen Bye, Cox's vice president of wireless.
Wireless phone service will add to Cox's video, phone, and Internet services to head off competition from phone companies like AT&T Inc. and Verizon Communications Inc., which already have wireless service and are rolling out video.
Cox, which has 6 million customers, appears to be the only major cable company that is building its own cellular network right now, but it's an area where the cable industry has long been involved.
Cox itself built and operated a cellular network covering Southern California and Las Vegas in the 1990s, then sold it to Sprint in 1999. Comcast Corp., the country's largest cable company, also owned a wireless network in the '90s and had ties to Sprint.
The cable companies teamed up with Sprint again in 2005 to market wireless service to their video customers, but the project was scuttled this year.
Forrester Research analyst Charles Golvin said Cox probably did the right thing to get out of wireless in the '90s to focus on upgrading its cable network with optical fiber that carries broadband and wired phone service.
In building a new wireless network now, Cox can take advantage of that fiber. Generally, wireless carriers are struggling with getting fast fiber-based data connections to their cellular towers.
They need the fiber to handle higher wireless data speeds used by smart phones like the iPhone and wireless laptop cards.
Even though Cox can use its dense fiber network for its cell towers, the cost of building a wireless network will be at least hundreds of millions of dollars, Golvin said.