Cable companies have alway been thought to be a factor in the wireless world with their embedded backhaul and and ready-made customer bases. But for one reason or another their promise has not become a reality, until now, perhaps.
In the wake of the failure of the T-Mobile-Sprint merger, Sprint announced an infrastructure partnership with Altice USA, a French company that purchased Cablevision and Suddenlink in 2015 to become the fourth largest U.S. cable company. The use of Altice USA’s fiber network will reduce Sprint’s backhaul costs.
Sprint officials said the deal had been in the works for six months and was not contingent on the completion of the T-Mobile merger, according to Sprint Chief Financial Officer Tarek Robbiati.
The agreement creates reciprocal access between the two companies’ networks. Altice USA will resell minutes as an MVNO on the Sprint network, while Sprint will be able to use Altice USA’s fiber network to backhaul its densified small cell network. The “infrastructure swap” was the first of its type, according to Robbiati.
“We have not seen enormous progress outside of Sprint in terms of densifying networks, which is key to the 5G future not just of Sprint but the whole country,” Robbiati said. “We have created a platform to do just that with several thousand small cells that we will be able to deploy.”
Sprint’s deal with Altice USA is part of the same strategy that led to a joint venture (http://www.aglmediagroup.com/lendlease-softbank-tower-jv-to-buy-8000-tower-rooftop-sites/) between Softbank Group (owner of Sprint) and Lendlease Group to buy 8,000 tower and rooftop sites. Both agreements further Sprint’s goal of densifying its network within its footprint.
“The priority is to significantly upgrade our existing footprint in terms of towers, parallel to densifying our [small cell] networks in our footprint, which covers the vast majority of the country,” Robbiati said.
During Sprint’s Q3 earning call, Softbank CEO Masayoshi Son said the carrier would increase its capex spend $3.5 billion in 2017 up to $5-6 billion in the medium-term.
“It is important that we invest in our network but also that the investment is really geared toward densifying our footprint,” Robbiati said. “The [Altice USA] agreement lowers the capital intensity of our buildout because we are literally sharing infrastructure between the parties. As well as giving us the ability to quickly deploy infrastructure at a minimal capital level, it is a wonderful opportunity to keep our network opex under control.”
Sprint is interested in solving the cable/MVNO model, he said, and is open to a similar agreement with other cable operators.
Altice USA provides broadband, pay television, telephone, Wi-Fi hotspot access, proprietary content and advertising services to 4.9 million residential and business customers across 21 states, including Arizona, Arkansas, California, Louisiana, Missouri, North Carolina, Oklahoma, Texas, West Virginia, New York, New Jersey, Connecticut and Pennsylvania.
J. Sharpe Smith is Senior Editor of the AGL eDigest. He joined AGL in 2007 as contributing editor to the magazine and as editor of eDigest email newsletter. He has 27 years of experience writing about industrial communications, paging, cellular, small cells, DAS and towers. Previously, he worked for the Enterprise Wireless Alliance as editor of the Enterprise Wireless Magazine. Before that, he edited the Wireless Journal for CTIA and he began his wireless journalism career with Phillips Publishing, now Access Intelligence. Sharpe Smith may be contacted at: [email protected]