Recent news does not bode well for the wireless joint venture between Sprint and several cable MSOs, branded as Pivot Wireless. Sprint announced during their quarterly analyst call that they are freezing the rollout of Pivot to any further markets due to “provisioning complexities.” In other words, they can’t get it to work, at least not without too much trouble. Both Sprint and its cable partners have publicly said they are disappointed with Pivot’s performance so far. Is this recent news a precursor to scrapping the joint venture?
Interim Sprint CEO Paul Saleh announced on their earnings call, “As our focus is on simplifying the business and particularly focusing on the customer experience, we have made a decision not to expand that service in other markets or other stores.” Pivot is currently offered in 33 markets, with Comcast, Cox, Time Warner, and Advance/Newhouse as its cable MSO partners. The news may be more troubling for the cable MSO partners than for Sprint (although Sprint has no shortage of troubles right now). Wireless is increasingly becoming an important addition to the triple play bundle. As telecom carriers continue their ramp up of triple play solutions, they are exploring ways to leverage their wireless lead. Both Verizon and AT&T are marketing bundles that tie wireless, wireline, and video together. Many analysts suspect that mobile wireless will be the wild card in the competitive battle between cable and telecom. The Pivot Wireless concept bridged the wireless gap for Cablecos, at least temporarily. It’s long been rumored that Pivot was not perceived by Cablecos as their long term wireless solution, but it did get them in the business much more quickly than if they built something from scratch. It appears that strategy may now be in jeopardy.
Partnerships of this scale are tough. Personally, I think the cable companies should just resell Sprint service instead of trying to create a new company/brand. Integrating various processes and cultures together on a scale like this rarely work. Cable should either go to a straight resale model, launch their own wireless effort (they do own spectrum), or buy a wireless company. This JV stuff isn’t going to work.
The telecom industry needs to seize on this misstep by cable. Wireless is the trump card. They should be moving aggressively.
Cablecos should have partnered with T-Mobile. They would have been better suited to make this thing work. It’s doomed with Sprint.