Friday, December 10, 2004


The new Sprint may be in a very sweet spot. If you read my earlier blogs, you know that Sprint has started the business of wholesaling air time to ESPN, Quest, AT&T and others. The new company should be able to add Comcast, Time-Warner and other cable companies!

VZ, SBC, and BLS operate the largest two cell phone companies but they are also spending billions to get into the TV business. Of course the Cable TV companies are ready to compete by getting into the phone business. The best way for the cable TV companies to enter the cell phone part of the business is to wholesale through a third party. They certainly will not want to feed their competition. Therefore, the new Sprint will be the ideal player to sell to the cable companies. If just one big cable company decided to become a MVNO or mobile virtual network operator as has ESPN, Virgin Wireless, Quest, AT&T and others, the subscriber growth rate for Sprint could be dramatic.

I would not speculate on the smaller cell companies. The three big guys have the economies of scale needed to offer packages of services that the little guys cannot offer. There will be buyouts of the little guys from time to time but pick an easy winner. Buy FON and relax.