UPDATED: This story has been updated to clarify Cox’s spectrum holdings as well as its initial reliance on Sprint Nextel for coverage in its launch markets.
Cox Communications has finally thrown in the towel on its failed attempt to enter the mobile space, announcing plans to stop selling services today and ending all service support by Mar. 30. The company cited its inability to achieve scale in the marketplace necessary to compete against established players as well as the lack of access to “iconic” devices as reasons for its departure.
Cox said it will provide current customers with a $150 credit per disconnected line as well as let those customers keep their devices and wave any early termination fee.
The move was not totally unexpected as analysts had noted Cox stood little chance of making an imprint in the mobile space. Some held out hope that Cox would be able to tap into its cable operations to provide a content package to its wireless offering that could differentiate itself in the market, though such offerings never materialized.
At an industry event in 2008, Cox President Patrick Esser brazenly proclaimed the company’s wireless operations would be able to capture 20% of the market. Esser said the service would have a consistent, cross-platform interface that would make it easier for customers to access their content anywhere.
That exit was hastened by the departure of Cox’s vice president of wireless, Stephen Bye, earlier this year who left Cox to become chief technology officer at Sprint Nextel. Bye was replaced Kelly Williams in April.
Cox had announced earlier this year plans to abandon building out its own CDMA-based 3G network in favor of a wholesale agreement with Sprint Nextel, which it said at the time would allow the company to focus on expanding coverage to more than 50% of the cable television footprint of its parent company Cox Communications.
Cox had initially launched its commercial wireless service just over a year ago, offering a trial service in Hampton Roads, Va.; Omaha, Neb.; and Orange County, Calif. The commercial launch followed a year of trials in those same markets. The service was available as a stand-alone offering or as part of a bundle with existing services, which included cable television, high-speed Internet and wired telephone services.
The initial service launch relied on a roaming agreement with Sprint Nextel that provided in-market and nationwide coverage for Cox. Huawei Technologies was tasked with deploying the CDMA-based network for Cox. The company was also trialing LTE services using its 700 MHz spectrum holdings with equipment from Huawei and Alcatel-Lucent.
Those spectrum assets could become a valuable commodity as entrenched wireless players are always on the prowl for additional spectrum assets and the forecast for upcoming spectrum auctions remaining dim. Cox had paid $305 million for its 700 MHz spectrum licenses and was part of a cable-company consortium that paid $2.4 billion for spectrum in the 1.7/2.1 GHz spectrum bands.
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