DirecTV & Echostar this week announced a deal with Clearwire to bundle a triple play of satellite TV, high-speed data and voice.
Financial terms of the deal, which also allows Clearwire to offer the video services of one or both satellite companies, was not made public, but Clearwire shares jumped 23.3% on Thursday to $24.50 after the news.
DirectTV is the nation’s leading satellite television service provider, with more than 16 million customers in the United States; EchoStar’s Dish Network pipes TV via satellite to roughly 13.4 million customers, so Clearwire has a good opportunity to accelerate customer growth. Clearwire owns spectrum rights in U.S. regions that cover 223 million people and currently has 258,000 subscribers in 39 U.S. markets and plans to move to the Mobile WiMAX standard later this year.
“Being able to offer services on the Clearwire network will give our customers another high-quality option to subscribe to broadband services with DIRECTV’s video offerings,” said Bruce Churchill, president of New Enterprises, DIRECTV. “By choosing this bundle option, DIRECTV customers will now be able to enjoy Clearwire’s fast, reliable and secure wireless broadband network that works great at home and on the go.”
Sprint Nextel Corp may explore a range of financial and strategic options in order to make Mobile WiMAX happen, said CEO Gary Forsee (left).
According to the Wall Street Journal, Sprint Nextel was also considering a merger with Clearwire to amid concerns over its $3 billion investment in a nation-wide Mobile WiMAX network.
Previous owner of DirectTV, Rupert Murdoch, promised to invest a billion dollars in a broadband plan that never materialized. Launch of the newly announced triple play tv service with Clearwire is slated for later this year.
Last year, satellite operators hoped to win some of the FCC’s Advanced Wireless Spectrum, but the companies exited the auction early, without winning any spectrum licenses. Sprint and cable companies made out like a bandit, however, paying $2.4 billion for 137 licenses in cities including New York, Boston, Washington, Detroit and Atlanta.