On the heels of recent announcements that both Comcast and Charter Communications are planning to activate their MVNO deals with Verizon, wireless executives reacted to it with nonchalance.
At an investor conference in September, Verizon CFO Fran Shammo appeared to shrug off the newcomers as an inevitability.
“We know that the cable companies have to get into wireless,” Shammo said. “That pie is growing and it’s not only cable companies …The world is going to become wireless, so if you believe the world is going to be wireless … then therefore this pie is going to grow and everybody is going to try to figure out how do they get a piece of the pie.”
“But for the carriers who exist today, that doesn’t mean their pie shrinks,” he continued. “Their pie grows as well and we all grow together. I think it just enhances the pie, it enhances the growth of wireless and we’ll compete competitively, so I’m not real worried about it.”
At the same conference, T-Mobile COO Mike Sievert almost laughed off the impact of cable players in wireless, saying “if you’re a T-Mobile shareholder, it’s hard to figure out how this could go badly for you.”
“Let’s say they do come in and school us all,” Sievert said. “That means there are now six viable national facilities-based carriers in a rapidly converging world … in a world where T-Mobile is highly efficacious at doing wireless … On the other hand they might roll in and find out its harder than they thought.”
But beyond just being involved in the future of wireless, it seems cable envisions an integral role for itself.
In a recent filing with the FCC, Charter Communications said it “plans to be a key part” of wireless growth by leveraging and expanding its existing Wi-Fi services, working with MVNO partners, and investing in its own licensed spectrum-based wireless network “at the appropriate time.”
Like the wireless carriers – who have already started work testing technologies for next generation networks – Charter said it recently submitted an application to the FCC to begin experiments with millimeter wave spectrum to “identify technologies and methods that will provide our customers with ubiquitous advanced communications services both inside and outside of the home.” Charter even suggested the commission open up unlicensed access in the 70 GHz and 80 GHz bands, as well as licensed mobile access for the 32 GHz band “to help the band integrate with its newly authorized Upper Microwave Flexible Use.”
Now, I don’t know about you, but that sounds like a bit more commitment than just jumping into an MVNO deal for a piece of the wireless pie. And, I’d argue, it should be enough to perk the ears of today’s wireless players given what analysts have said on the topic.
Back in September, MoffettNathanson analysts said cable’s infrastructure will win out in wireless over time as the line between wired and wireless becomes increasingly blurred thanks to technologies like Wi-Fi. The analysts also pointed to cable’s advantage in backhaul, where those with the densest wired networks will come out on top.
“The industry is already too crowded, and if networks really do begin to take on the economic character of wired networks, we know from experience that the sustainable number of networks will necessarily fall,” the analysts wrote. “We believe cable will be one of the winners. That leaves four wireless operators vying for what might only be one, or perhaps at most two, additional spots to fill.”
So sit up, wireless CEOs. There’s a burglar on your lawn.
