Sprint announced the wholesale availability of its femtocell solution to its partners, including cable companies. The arrangement will allow Sprint partners to offer branded CDMA based femtocell service to subscribers. Sprint has been offering the Samsung Airave femtocell to its retail customers for nearly a year.
A Sprint CDMA femtocell creates an ‘indoor cell tower’ that uses a customer’s broadband connection as backhaul for wireless traffic originating and terminating on a compatible wireless device. Conceivably, it provides better indoor coverage for wireless and makes it easier for customers to cut the wireline cord in favor of wireless only.
Cable companies may be interested for a couple reasons. While wireless substitution has greatly impacted wireline telcos, cable companies with their wireline VoIP services are not immune. They too will feel an impact from cord cutting. A femtocell solution may offer some ‘cord cutting cover,’ providing cable companies the ability to maintain a telephony relationship with customers who decide they no longer need cable digital voice service. They can now also market a service to wireless only households who don’t need a traditional cable triple play. These scenarios provide interesting competitive differentiation propositions.
Cable’s desire to expand their wireless product portfolio is no secret. The industry already has a historical telephony relationship with Sprint. Sprint carries a ton of cable VoIP traffic on their national fiber network. They also courted major cable players to join them in the WiMAX Clearwire joint venture. This femtocell announcement only adds to the cable-Sprint alliance. Beyond Clearwire, Sprint is also working closely with Cox on its wireless venture. As a result, a Cox branded femtocell may well be on the horizon.