Newspaper article THE JOURNAL RECORD

Sprint-Cable Alliance Targets Phone Service

Newspaper article THE JOURNAL RECORD

Sprint-Cable Alliance Targets Phone Service

Article excerpt

NEW YORK (AP) _ Sprint Corp. and three large cable companies joined together Tuesday to try to topple local phone monopolies and create a national wireless network.

Tele-Communications Inc., Comcast Corp., Cox Enterprises Inc. and Sprint hope by later this decade to present consumers with one place to turn for local, long distance and mobile phoning and cable TV.

Some state and federal regulations would need to change first. But the companies represent a solid combination of national marketing strength and access to millions of homes with wires that can carry more signals than regular phone lines.

"Our (venture) is unique and will be difficult, perhaps impossible, to replicate," said William Esrey, chairman and chief executive officer of Sprint.

The three cable companies serve more than 16 million customers, operating in the nation's 50 largest markets and dozens of smaller cities and towns. Sprint is the nation's third-largest long distance company and also has local and cellular businesses.

Sprint will own 40 percent of the venture with TCI holding 30 percent and Comcast and Cox 15 percent each. They did not disclose more financial details, citing a desire for secrecy before the government's auction of airwaves in December.

The deal signals a change in how the telecommunications industry is being reshaped. Instead of cable companies lining up with local telephone companies, the largest cable operators are now ready for all-out competition with them.

Earlier this year, TCI planned to merge with Bell Atlantic Corp. and Cox set up a joint cable venture with Southwestern Bell Corp. Those deals collapsed after rate reduction ordered by the government in February changed the value of the cable firms.

Both John Malone, TCI's chief executive, and Jim Kennedy, Cox chief executive, said Tuesday the Sprint venture probably eliminates future deals with the regional Bell companies, GTE and other local phone firms.

"This is the right idea at the right time," Malone said. "Cable affiliates have been looking for an aggressive telephone play. Our capital markets are looking for a viable communications strategy. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.