Race to offer consumers a “quad play’ making M&A mayhem

The race to offer consumers a “quad play” — phone, TV, broadband and wireless — is making for M&A mayhem.

Comcast and Charter Communications, the country’s two largest cable operators, have reset the deal agenda for cable and telecom companies by entering into exclusive negotiations with Sprint.

Talks between the cable behemoths and Sprint, the smallest of America’s Top 4 wireless telecoms, are now in their second month, according to reports initially published by the Wall Street Journal.

The revelation undermined expectations that Sprint was about to tie the knot with T-Mobile, the country’s third-largest wireless carrier.

Cable’s barging in on those wireless discussions didn’t sit well with T-Mobile investors. On Tuesday, the stock fell 3.4 percent, to $61.01 a share. Meanwhile, Sprint gained 2.1 percent, to $8.18, on news that it’s being courted by the cablers.

The courtship’s timing follows by barely a month an announcement that Comcast and Charter would partner on their own wireless network.

That was also a surprise, considering the two companies already have agreements with wireless leader Verizon to offer cell phone plans.

Those plans allow the companies to piggyback on Verizon’s cellular network through a so-called mobile virtual network operator (MVNO) agreement.

Adding to the confusion is what many perceive as posturing by cable and telecom participants as their wired and wireless offerings converge.

“This cable conversation could be an effort on Sprint’s part to bring T-Mobile to the table,” Merrill Lynch’s David W. Barden wrote in a Tuesday update. “[But] it could just as easily be a ploy by cable companies to extract better MVNO terms from Verizon.”

Added BTIG’s Walter Piecyk, “These early deal salvos could lead to any number of potential combinations, based on the personalities involved.”

Source: http://nypost.com/2017/06/27/race-to-offer-consumers-a-quad-play-making-ma-mayhem/

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