Cox Pulls Out of Wireless

Cox Communications Inc. announced Tuesday night that it is shutting down its wireless service on March 30.

The MSO will stop selling the service on Wednesday (Nov. 16). Customers will get a $150 credit for every line of wireless phone service being disconnected, a gesture meant to help with their transitions to new providers. Cox is also waiving early termination fees.

Cox, which was piggybacking its wireless service on the Sprint Corp. (NYSE: S) 3G network, said its decision was "based on the lack of wireless scale necessary to compete in the marketplace, the acceleration of competitive 4G networks as well as the inability to access iconic wireless devices."

Theoretically, Cox had a shot at the iPhone once Sprint got hold of it, but the MSO was non-committal about its interest (or lack thereof) in offering the device. (See Cox Dodges iPhone Question.)

Cox isn't disclosing how many customers signed on for the service since it launched in November 2010, about seven months later than expected. Cox was on track to deploy wireless service in about half its footprint by the end of 2011, and so far it had gotten up and running in Hampton Roads and Roanoke, Va.; northern Virginia; Orange County, San Diego and Santa Barbara, Calif.; Omaha, Neb.; Oklahoma City and Tulsa, Okla.; Rhode Island; and some pockets of Connecticut and Cleveland.

The decision isn't earth-shattering. Cox is on the verge of a significant reorganization, and it had already pulled back on a plan to build its own 3G and Long Term Evolution (LTE) network using Advanced Wireless Services (AWS) and 700MHz spectrum obtained at auction for about $550 million. (See Cox Gets Ready to Reorg.)

Why this matters
It's another failed attempt by cable to enter the hyper-competitive mobile voice market -- Cox and several other MSOs pulled out of the Pivot partnership with Sprint in 2008 -- and it's likely to make MSOs even more gun-shy about developing wireless strategies. (See MSOs Pivoting Away From Sprint JV.)

For more
Read about the trials and tribulations of Cox's wireless foray.

— Jeff Baumgartner, Site Editor, Light Reading Cable

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