The Verizon Wireless will acquire Airwave Rights covering 28 million people from the cable operator Cox Communications Inc. for $ 315 million, the companies said, the latest chapter in an unusual interface between the cellular giant and cable TV companies.
The agreement allows Cox and Verizon Wireless to sell services to other stores and other sales channels. The joint marketing agreement is similar to that agreed to the innovative agreement reported earlier this month between Verizon and Comcast Corp, the Time Warner Cable Inc and Bright House Networks, which Verizon said it will pay the cable consortium for $ 3.6 billion wireless spectrum licenses covering 259 million people in the U.S.
Buy the Verizon spectrum by Cox, a closely held Atlanta based company with six million customers throughout the U.S., is also the latest sign that the cable companies dropping long courtship by offering its own wireless service them.
Cox had started building the wireless network before the fall of the effort earlier this year to offer a wireless used Sprint Nextel Corp. 's network. Cox dropped the effort last month, saying its customers from San Diego to Rhode Island will have to switch to another provider until March 30. Cox, said the decision to discontinue wireless service came from its inability to compete with both major airlines develop faster wireless networks and phones slicker.
The sale of spectrum licenses to Verizon Wireless, a joint venture between Verizon Communications Inc and Vodafone Group PLC, will still need regulatory approval. Cox, said it was to hold spectrum licenses in the valuable 700 MHz, where signals propagate better, but did not say what the range could be used. The spectrum licenses Cox is selling at Verizon are in the same frequency range, such as Verizon agreed to buy the cable-company consortium in agreement earlier this month.
A spokesman for Cox, Todd Smith, did not disclose the original cost of the spectrum, but said the company got a premium on the deal Friday that is similar to what other cable companies were in agreement. In this case, the companies sold spectrum at marking more than 50%.
Cox purchased 700 MHz spectrum for $ 305 million in a government auction in 2008, Mr. Smith said. "We believe that the spectrum continues to be a valuable asset, but can not speculate on future projects," he said in an e-mail.
The agreement with Verizon means Cox customers will be able to buy products through Verizon cable company, while the Verizon stores in the areas covered by Cox will be able to sell cable TV service from the company.
Article source:-http://online.wsj.com/article/SB10001424052970204553904577102481574208616.html
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