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Verizon, MSOs Kill Wireless JV

Forget about that cable/wireless technology innovation joint venture between Verizon and three major US MSOs.

Verizon Communications Inc. (NYSE: VZ) CFO Fran Shammo said the much-ballyhooed deal, which Verizon struck with Comcast Corp. (Nasdaq: CMCSA, CMCSK), Time Warner Cable Inc. (NYSE: TWC), and Bright House Networks nearly two years ago, “has been terminated.”

Speaking on Verizon’s third-quarter earnings call Thursday, Shammo didn’t offer much explanation, merely saying the four companies are “moving in our separate ways on that.” As later clarified by a Verizon spokeswoman, the joint venture was actually dissolved in August. In a statement emailed to reporters, she said that “evolving technology and market changes since the joint venture was formed have led all parties to conclude that a joint venture, per se, is no longer needed to deliver innovative services to customers.”

Shammo said Verizon and the MSOs are continuing to work together to market bundles of cable and wireless services to their respective customers as part of the Advanced Wireless Spectrum (AWS) deals struck in December 2011. Under those pacts, which also involve Cox Communications Inc. , Verizon and the four major cable providers have launched promotions in scores of markets throughout the US. (See MSOs Sell AWS Spectrum to Verizon for $3.6B and MSO Deal Not Verizon's Spectrum 'End Game'.)

The move to terminate the wireless JV comes in the wake of Verizon’s pending agreement to buy Vodafone UK ’s 45 percent stake in Verizon Wireless for $130 billion. With that deal behind it, Shammo said Verizon will focus on bringing customers the best wireline and wireless products available. (See Vodafone Agrees to $130B Verizon Stake Sale.)

— Alan Breznick, Cable/Video Practice Leader, Light Reading

albreznick 10/27/2013 | 9:18:40 PM
Re: Wireless Strategies Well, Dan, I think they're throwing just about everything they have into WiFi right now. That's where all the action is. And they'll continue to market the wireless bundles with Verizon Wireless. But I don't think they'll be trying any more 3G or 4G stuff anymore, either on their own or in partnerships with the telcos.
DanJones 10/21/2013 | 2:06:06 PM
Wireless Strategies Wonder what the MSOs are planning to do for a wireless strategy now?
albreznick 10/17/2013 | 5:15:37 PM
Re: other priorities And I was always surprised that the cable companies would team up with Verizon on something like this. Well, add it to the long and growing list of failed cable joint ventures with telcos, only this time it seems to be Verizon's doing, not cable's.
Carol Wilson 10/17/2013 | 5:09:51 PM
Re: other priorities I was always a little surprised Verizon wanted to team up on anything with cable companies that mentioned "innovation."
DOShea 10/17/2013 | 2:46:43 PM
Re: other priorities The JV was only going to be temporary anyway-until the end of 2016, acording to this story: http://www.lightreading.com/document.asp?doc_id=697715. Still, ending it more than three years early might mean both companies wanted to keep their best innovation ideas away from the JV.
DanJones 10/17/2013 | 2:17:14 PM
Re: other priorities I would say Verizon/VZW expansion is very much the focus. Seriously outstripping rivals on the subs numbers now, I'll note.
Sarah Thomas 10/17/2013 | 1:59:15 PM
Re: other priorities That could very well be. I also took it to mean that they were going to focus on more integration within Verizon/Verizon Wireless now that Vodafone is on its way out, versus integrating with other players in the market.
KBode 10/17/2013 | 1:57:37 PM
Re: other priorities Shammo seemed to place some blame on the call on the Vodafone deal, but I'm not sure how that would be relevant (anyone know?).

I'd wonder if the "magical products" (from a VZ job description) they were working on with cable just didn't turn out to be all that magical?
Sarah Thomas 10/17/2013 | 1:33:23 PM
other priorities It was pointed out to me on Twitter that the move "speaks to their comfort in FiOS roll out as well as owning all of VZW, also likely a function of specter of cable M&A." It makes sense when you think about all these factors coming together, but I admit I was surprised to hear Shammo offhandedly mention it was terminated. 
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