Altice, Sprint Announce Wireless Partnership
Altice USA has struck a deal with Sprint Corp. that will allow the cable operator to sell wireless service using Sprint’s network.
U.S. cable operator Altice USA will sell mobile service on wireless carrier Sprint Corp's network under a new multi-year agreement announced on Sunday, becoming the latest firm to enter the wireless market in a bid to keep customers.
The companies announced the agreement a day after Sprint and T-Mobile US Inc ended merger talks. The two companies called off merger talks to create a bigger U.S. wireless company to rival market leaders. That has left Sprint, the No. 4 U.S. wireless carrier, to contrive a turnaround on its own.
As part of the agreement, Sprint will use Altice’s broadband infrastructure to strengthen its nationwide wireless network, according to a statement from both companies that didn’t disclose financial terms.
SoftBank Group Corp, Sprint's majority owner, said in a separate announcement on Sunday that it planned to increase its stake in Sprint but that it would keep ownership of outstanding common stock under 85 percent, a move that prevents from triggering a tender offer for the remaining shares. SoftBank currently owns roughly 82 percent of Sprint.
The deal between Altice and Sprint marks the latest example of a U.S. cable operator entering the wireless business to compete with giants like Verizon Communications Inc. and AT&T Inc. Comcast Corp., the nation’s largest cable operator, recently started selling cellular service using Verizon’s network. Charter Communications Inc., the No. 2 cable operator, plans to enter the wireless business next year.
Offering cellphone service, in addition to TV and high-speed internet, could help cable companies keep customers as many drop pay-TV for cheaper online options.
“As content and connectivity continue to converge, we believe this approach will be a model for future strategic arrangements across multiple industries including cable, tech, and others,” Sprint Chief Executive Officer Marcelo Claure said in the statement. He had said in May that the company was working on a mobile virtual network operator pilot program with a partner he didn’t name.
U.S. cable companies have begun venturing into the wireless market as a way to bundle more services to reduce churn, or customer defections, at a time when more consumers are canceling cable subscriptions.
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