The decision by Cox Communications, the nation’s third biggest cable operator, to spend $1 billion to get into the mobile phone business is either brilliant or quixotic, Multichannel News reports.
Among those skeptical about the deal is well-known analyst Craig Moffett of Sanford Bernstein, who told Multichannel, “this is a market that just isn’t very attractive.”
Cox President Pat Esser said that the company has been criticized before for offering products that turned out to be successful. He added, “We think it’s important as a communications provider to offer wireless. Our current customers and our next generation of customers are telling us they want and need mobility as part of their life.”
Previously Cox, along with Bright House, Comcast, and Time Warner Cable, were partnered, along with Sprint Nextel, in a wireless venture called Pivot.
The other MSOs, Multichannel notes, are just offering data services now. Cox will purchase wholesale network access from Sprint and other wireless carriers for its upcoming voice and data service.
The service will launch in the second half of 2009, Multichannel says.