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Sprint Selling Cell Towers, Will Cable Benefit?

Michael Harris
BroadBananas
Michael Harris
11/24/2004

If you've been reading the CDN Blog this month, you're aware of moves by major U.S. MSOs to collaborate on the development of a mobile communications business to augment their wired broadband services. Today the Wall Street Journal reported that Sprint Corp. has received preliminary bids for its 6,500 cell phone towers from at least four groups, including Global Signal Inc., and surprise, cable magnate John Malone's Liberty Media Corp. It is expected that the towers will sell for more than $1 billion. MSOs could bid to buy the towers themselves, or simply choose to lease capacity from the buyer, whether it's Liberty or anther player. In either case, the wireless venture MSOs are envisioning could focus on leveraging cable facilities for connecting towers to the wired world, as well as building the back office and service infrastructure to serve cable's mobile needs. As a communications service provider, Sprint says the towers are non-strategic assets, and that they are better off leasing capacity from the buyer and using the sale proceeds to pay down its $15.6 billion debt load. It's an approach similar to ISPs that lease backbone network and dial-in POP infrastructure from carriers like Level3. The Wall Street Journal article (Subscription Required) is at http://online.wsj.com/article/0,,SB110125258257482376,00.html

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