Comcast, Time Warner preparing to bid farewell to Clearwire
Cable providers Comcast and Time Warner Cable will stop reselling Clearwire's 4G wireless service following their agreement to hand off their unused mobile spectrum to Verizon Wireless for $3.6 billion, CNET has learned.
Part of the Verizon deal gives the cable companies the right to resell Verizon's wireless service, which will become the cable providers' exclusive partner once the spectrum aspect of the agreement goes through, said Time Warner Cable spokesman Alexander Dudley.
Both companies will slowly wind down their Clearwire business over the next six months, and plan to move their existing customers to other options.
The move ends what has been a lukewarm relationship between the cable providers and Clearwire, which provided mobile broadband service through USB cards and mobile hotspot devices. Comcast, Time Warner Cable and Bright House Networks were early investors in the current version of Clearwire, which was created through a deal with Sprint Nextel, hoping that its 4G network would complement their own bundles of home Internet, phone and television services.
After a slow start, the cable companies began promoting cable-branded 4G mobile broadband service. But their enthusiasm for the service waned amid tepid customer adoption. Comcast, for instance, only has about 30,000 customers using the mobile service out of 17.8 million traditional broadband subscribers. Bright House, which had the option to resell 4G service, never actually got it off the ground.
Clearwire has largely depended on Sprint as a wholesale customer, with the two reaffirming their relationship yesterday after Sprint agreed to provide further funding to the cash-strapped company. The cable companies will remain minority shareholders in Clearwire.
Still, it's a blow to Clearwire, which is looking to expand its wholesale business model and serve as a neutral provider of 4G service. The company intends to upgrade its network to 4G LTE to better compete with other carriers, including Verizon Wireless and AT&T.
A representative for Clearwire couldn't immediately be reached for comment.