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Revived cableco alliance could save Xohm...

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Comment Former Sprint Nextel CEO Gary Forsee may have made a massively bad job of managing the carrier's merger and other operational challenges, but he left three major innovations as his positive legacy, which may still be the key to a Sprint turnaround.

One was his pioneering of the MVNO (multiple virtual network operator) model, which will be critical to Sprint's Xohm WiMAX-based business as well as its CDMA activities. The others were Xohm itself, and the deal with four major cablecos (Time Warner, Comcast, Bright House, and Cox) announced in 2005 and later dubbed Pivot.

Both Xohm and Pivot were ambitious in concept; both have had their wings severely clipped by Sprint's financial troubles and consequent shareholder nervousness, to the extent that Pivot is all but dead; but both could, if properly supported, turn Sprint into the disruptive carrier it aims to be, and do this more effectively if combined.

The failed cable dream

As Sprint casts around for investment partners to keep Xohm alive with less cost and risk to itself, there is the prospect that the vision Forsee conceived, even if he failed to execute, could be revived. Three of the Pivot partners are rumored to be mulling an investment in Xohm, or more probably in a joint venture between Xohm and Clearwire.

This venture – mooted last year and now on the cards again - would own nearly all the 2.5GHz mobile broadband spectrum in the US, with sufficient capacity to support a fully broadband fixed and mobile network that could propel the cablecos into the mobile and converged world, going head-to-head with AT&T and Verizon on geographic reach and range of advanced services.

While Pivot dwindled into little more than a cross-marketing agreement for cable and cellular services – and an unsuccessful one at that – at the outset it was intended to be something far more ambitious, with the five partners investing in creating a converged fixed/mobile broadband service using Sprint's CDMA and, later, WiMAX networks, and enabling the cablecos to match the convergence moves of the major DSL/fiber providers, and outdo the satellite TV operators.

This would have given Sprint an important position in US media and telecoms, in effect leveraging the cablecos' networks and customer bases to mount a challenge to Verizon and AT&T that would be impossible on its own.

For this vision to materialize, Xohm needs to be part of the deal, because it can deliver the kind of advanced services and true "broadband anywhere" that will be essential for cablecos to stay abreast of the major telcos.

It will also have the potential to carry the cable operators' TV content wirelessly, reaching mobile or nomadic devices and new geographic regions. This will be the great hope for NextWave, which recently announced a WiMAX implementation of its mobile TV technology for TDD spectrum, called MXtv.

At last week's CTIA wireless industry conference in San Francisco, NextWave talked up this development and demonstrated prototypes, dropping heavy hints that it would be of interest to Xohm and possibly to the cable operators.

Certainly, it would allow the cablecos to respond to another move by Verizon and AT&T – the move towards mobile TV, with both the major carriers currently using Qualcomm's MediaFLO system.

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Next page: Interest in Xohm

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