March 1, 2007

Getting a Fix on FMC

By Jim Barthold

The telecommunications space can be a challenging thing to understand. Information provided to and in consumer media via news releases from both vendors and operators and especially during earnings conference calls can deviate sharply from reality.

Press releases and executives on earnings calls aimed at financial analysts have said the Sprint-cable joint venture (JV) has rolled out some nascent FMC version in six markets with a total of 30 markets planned for the year. When pressed for more information, however, those involved with the business, with varying degrees of politeness, just won't talk, although one top executive at a JV member company, speaking on background, said, "I am not sure there is much to write about vis a vis FMC right now - lots of initiatives, but not much people will talk about now since it is so early. Lots of smoke; not much heat."

On the record, Gary Forsee, chairman-CEO of Sprint Nextel, used his company's fourth-quarter earnings conference to say the "cable joint venture continues to move forward" and "has now launched six markets commercially, and we have scheduled more than 30 markets to be launched by the end of 2007."

That's a lot more upbeat than the tenor of a panel "Look Ma, No Wires! Cable and Wireless Integration for Seamless Applications Delivery" during SCTE's Conference on Emerging Technologies in Houston last month when Ken Falkenstein, vice president of wireless engineering at Comcast Cable, and Ben Vos, vice president of core technologies for Sprint Nextel, danced around the tenuous JV relationship.

"We expect, just as we keep our options open, our joint venture partners to keep their options open," Vos said.

Cable's options include using 1.7 GHz wireless spectrum cable bought at auction. Sprint's surround 2.5 GHz spectrum it is fitting out for a WiMAX play that really looks like wireless cable.

"Our WiMAX business plan is predicated on the 2.5 spectrum ... which is an incredible spectrum position," Forsee said. "It's two times what any other competitor company would have in terms of overall bandwidth and capability in terms of spectrum coverage, so we have an incredible asset, and we will look for astute and smart ways over time to demonstrate that value."

That will happen in Chicago and Baltimore-Washington, D.C., where Sprint Nextel expects to deploy infrastructure "by the latter part of this year and (have) commercial service available in early 2008," Forsee said.

In the meantime, cable and Sprint continue to work together on technology and programming and a loving, caring, sharing relationship.

"Although the contributions to this joint venture are in early stages, we expect subscribers in this JV to ramp during the course of 2007 and be a solid contributor to our business results in 2008," Forsee said.

- Jim Barthold