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Industry News

DirecTV’s Wireless Play Still in Limbo

Satellite provider’s watching new Clearwire; cheering for telcos

June 12, 2008
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It wouldn’t hurt DirecTV to come up with a triple play bundle of some sort to mesh with its HD- and sports-rich television packages, but don’t expect the satellite provider to jump into the WiMAX space, an executive said during the Lehman Brothers Worldwide Wireless and Wireline Conference.

“I think all along our goal on broadband, including WiMAX, has been to ensure customers have choices in broadband and telephony that are compatible with DirecTV,” said Chase Carey, president/CEO of DirecTV Group. “That said, if there was an investment to be made or a role to take in a broadband solution like WiMAX, I think we’d look at it, but with care, recognizing the challenges and issues in the broadband business.”

Broadband is tough.

“Broadband and telephony are much more commoditized businesses, much more geared towards competing on price,” he said. “Television being much richer is really the value end of the equation.”

That leaves DirecTV looking for a partner to bring in those broadband elements and that takes the company back to the arms of incumbent telcos who, when they’re not rolling out competitive U-Verse or FiOS TV offerings, need their own video component.

“The big telcos, AT&T and Verizon—outside the FiOS footprint— will continue to develop ways that truly are compatible whether we have deals or not … and continue to drive things that are good for us, like mobility into the marketplace through cellular the like,” he said.

A relationship with what had been BellSouth ended April 1 and there’s a possibility a new one could blossom with new BellSouth boss AT&T, which is re-evaluating its satellite relationship with EchoStar’s DISH Network. Verizon is already a partner.

One place DirecTV won’t look to partner is the new Clearwire, the WiMAX play developed by Sprint and the old Clearwire with money from cable players Comcast, Time Warner Cable and Bright House Networks as well as interested parties like Google and Intel.

“The Sprint and Clearwire configuration has some long road to hoe but we certainly aren’t implying that we won’t continue to track it, evaluate it, see what happens,” Carey said. “It has a lot of steps to take.”

And a lot of people to keep happy as it takes those steps.

“The list of six-party partnerships that have been raging successes is pretty short,” he said ruefully. “You have a lot of competing agendas there both within some of those places and between some of those places in terms of what they want to do.”

Recent Articles by Jim Barthold, Telecommunications

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