Cable companies to resell Verizon Wireless service

Cable companies Comcast, Time Warner Cable and Bright House Networks are giving up on their dreams of creating their own wireless network, opting instead to resell Verizon Wireless service. The companies announced today a sale of their wireless licenses—which they haven’t been using—to Verizon Wireless for $3.6 billion. Cable companies have long had ambitions to get into wireless, and some of them have linked up with Sprint Nextel and Clearwire to offer service. Lately, there has been speculation that the cable companies would invest in either of the ailing No. 3 and 4 carriers, Sprint and T-Mobile, to gain access to the wireless market. The link-up with No. 1 carrier Verizon Wireless and the sale of the spectrum appears to preclude that kind of deal. “It’s really hard for a cable company to expect to compete in a highly competitive wireless market,” says Time Warner Cable spokesman Alex Dudley. He points to Cox Communications, which this year shut down its plans to build out a wireless network. Comcast, the country’s largest cable company, owned the majority of the spectrum holding company, and will get $2.3 billion from the sale. Time Warner Cable, the second-largest cable company, will get $1.1 billion. Bright House, the sixth-largest, will get $189 million. The three companies and Verizon Wireless will resell each other’s services, so it will be possible to sign up for cable service in a Verizon Wireless store. Billing will be separate. For some analysis from c|net on the winners and losers of the deal, click here.