Charter Communications recently announced its acquisition of Time Warner Cable Inc. as well as Bright House Networks LLC, two deals which have now made it the second-largest broadband provider and the third-largest pay-TV provider in the U.S. Flush with its success, Charter is now aiming its sights at offering nationwide wireless services by using Verizon's wireless network. Back in 2011, Verizon had entered into an agreement with SpectrumCo, a group comprising of Time Warner Cable, Bright House Networks, Comcast and Cox, to purchase AWS-1 spectrum. In return, Verizon gave permission to these companies to use its wireless network in case they chose to roll out wireless services as Mobile Virtual Network Operators (MVNOs). Charter wants to take advantage of the 2011 agreement to debut as a wireless service provider in the near future.
Charter is following in the footsteps of Comcast, the largest cable provider in the US, who is currently testing solutions to turn into an MVNO in due course thanks to the deal with Verizon. Tom Rutledge, CEO of Charter Communications, today said that the company is in a good position to offer wireless services and added that the company may offer a small cell service based on a licenced spectrum available at cheap rates. Charter has invested $56.7 billion towards the acquisition of Time Warner Cable and another $10.4 billion towards the acquisition of Bright House Networks and it wouldn't be too surprising if the company decides to make the most of these deals. On the pay TV front, Charter and other pay TV services like Comcast have been facing stagnation recently due to the emergence of over-the-web services like Hulu and Netflix, but the greater threat arises from services like HBO NOW and Sling TV which offer live or current season programming. The recent decline in the popularity of pay TV services may also have prompted Comcast and Charter to shift their focus on the wireless market using abundant low-cost spectrum from Verizon.
While approving Charter's twin acquisitions last week, the FCC stated that the three companies "contend that the transaction would enable New Charter to be a new entrant in the mobile wireless market by offering mobile products through increased WiFi deployment, the deployment of licenced spectrum or a mobile virtual network operator (MVNO) arrangement- and likely through some combination of these." Given that it is impossible for FCC to make such a statement unless Charter and the other companies did make such submissions, Charter may have harboured its plans of entering the wireless markets for a while since the deals were hanging in the balance for over a year pending antitrust approvals from the U.S. Justice Department.