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+ FollowVerizon, Spectrum Co. Shake Up Tech Sector With New Partnership
When people talk about technology and innovation they often look to Silicon Valley for the next big thing – the killer app that is sure to change our lives. The coffee talk may be about to change, however, as infrastructure players rally to the forefront with a dynamic new business model sure to shake up the tech sector and our overall communications landscape.
Verizon Wireless and Spectrum Co., LLC, a joint venture between Comcast, Time Warner Cable and Bright House Networks, have announced a partnership in which Verizon Wireless will purchase 122 Advanced Wireless Spectrum licenses from Spectrum Co. for $3.6 billion.
While the licenses cover 80% of the U.S. population and are subject to FCC approval and DOJ anti-trust review, this is no merger. Verizon Wireless is only acquiring unused spectrum assets being held by the cable companies party to this agreement, and the companies do not seem to be consolidating operations, leaving competition vibrant in the marketplace. This partnership takes a forward-thinking look at consumer needs for data consumption, and strives to improve service quality while mitigating issues associated with impending spectrum crunches, which tend to hit urban areas the hardest.
What is particularly interesting is that these companies, traditionally rooted in the old bell model, are now in process of reinventing themselves to better serve consumer interests and corporate needs, alike.
Going forward, “the quadruple play” will become available to more people, as cable companies like Comcast will now have a wireless offering to overlay their traditional services in an era when mobile technologies are increasingly in demand. For the consumer, this enables a new entrant in the market, allowing for greater diversity of service offerings. While the companies involved are looking to expand the availability of their current products, they will continue to compete, giving customers an opportunity to choose the best products for their needs.
The companies have also agreed to create an innovation lab aimed at optimizing wireless and wireline services. It is a win-win for consumers who will have greater access to a variety of wireless and cable offerings within their service territory, and get the benefit of having the companies invest additional resources toward answering a simple question: how can service providers do a better job of delivering video on mobile devices?
As communications technologies become increasingly important to our everyday lives, this partnership is especially important for African Americans and Latinos who, according to the Pew Internet and American Life Project, over-index in the use of mobile devices and are among the highest consumers of video services. As the primary users of wireless services, these communities have the most to lose if spectrum is not efficiently leveraged and optimized.
Innovation is not just limited to the confines of the Valley. As this partnership proves, it is often right around the corner or under our noses waiting for the ideal moment for the big reveal.
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12 Responses to Verizon, Spectrum Co. Shake Up Tech Sector With New Partnership
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This is a great example of companies evolving to meet the needs of the consumer. I'm especially excited to the see innovations that can definitely affect the underserved. This also speaks to the fact that competition is alive and well and driving innovation. I'm excited to see what new products come out of the innovation lab.
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lisalynn says:
How exciting for minorities, since we are among the biggest users of wireless and mobile devices! It sounds like this could really help shrink the digital divide!
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Belinda says:
Definitely sounds like an innovative way to improve service quality for consumers. It isn't everyday that competitors become partners for the good of the consumer. Wow! I'm feeling all warm and fuzzy!
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Melanie Thomas says:
Certainly an "outside the box" kind of partnership! A relatively simple solution to acquiring an extremely essential need….spectrum!
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Greg Roberts says:
Hopefully, this will put a bug in the ear of the FCC that competition comes through a myriad of different avenues and will force them to reevaluate the AT&T/T-Mobile merger!
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Wm_Tucker says:
What's "dynamic and new" about a business model that's designed to divide the market and squash all competition? This joint venture is the definition of collusion. And it's as blatantly anti-consumer as the AT&T-T-Mobile merger.
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This partnership definitely offers access to more broadband capacity. The last thing consumers need is dropped calls or interrupted data flow. It also puts pressure on the FCC to reassess its position that AT&T, T-Mobile will somehow lessen competition when you have transactions like these that increase capacity, increase the number of potential wireless carriers, and keeps prices in check.