Altice USA, the nation’s fourth-largest cable company, is teaming up with Sprint, the nation’s fourth-largest wireless network, in order to create a new wireless carrier. The new service will be virtual network running on Sprint’s wireless infrastructure, just like how Comcast uses Verizon’s network for its Xfinity Mobile service.
The deal comes a day after T-Mobile and Sprint announced that merger talks are officially dead, meaning this is likely a plan that Sprint and Altice have been sitting on while merger talks were ongoing. It’s not much of a consolation prize for Sprint’s investors, but it’s better than nothing.
The deal is something of a win-win for both sides. This particular MVNO partnership goes deeper than the typical agreement — instead of just using Sprint’s service, Altice is being embedded deep into Sprint’s network. “In this first of its kind agreement, Sprint will provide Altice USA with access to its full MVNO model, allowing Altice USA to connect its network to the Sprint Nationwide network and have control over the Altice USA mobile features, functionality, and customer experience,” a statement from the two companies said.
In return for access to Sprint’s inner network functions, Sprint will get access to Altice’s cable network to help build out its small-cell sites. Using mini cell towers broadcasting at higher frequencies than typical LTE bands is an increasingly popular way for networks to get coverage inside, or at congested venues like sports stadiums.
Sprint is sitting on huge holdings of valuable high-band spectrum, but it lacks the resources (or customer base) to build out a network. Deals like this one with Altice should help it improve its network on the cheap, while bringing in some much-needed cash.