Cox Communications is one cable company that is wasting no time and embracing wireless. Cox's wireless subsidiary, Cox Wireless, spent around $304 million and snatched up 14 Block A and eight Block B licenses as part of the recently concluded 700 spectrum auctions. Now, there is word that the company has given the contract to build the network to Chinese equipment maker, Huawei. UBS Research in a note to its clients notes that, Huawei is going to supply CDMA gear for a wireless network.
That's not the big story. What's big is that Cox, alone among its' peers, has a huge advantage going into the coming battle for next-generation Wireless consumers.
While Comcast, Time-Warner and Charter (through Paul Allen's Vulcan) bid on, and won, licenses, building a new network is a big deal for a company with huge amounts of infrastructure to maintain. In a market (700Mhz) where Verizon has already won the "top dog" blocks, shareholders might get angry, especially if an operator bungles the venture.
Not Cox. Remember, they're owned entirely by one family. Cox Enterprises, Inc. is a totally private operation. Even their Cable company, which once was publicly traded has all of its' shares ultimately by CEI after the Cox family took it private several years ago.
According to this survey, consumers would buy wireless service from their cable company if they could. Cox has a market lock and a good reputation in its' core communities, where, coincidentally, it won the most spectrum.
Consider that unlike Charter or Comcast, which have a fiduciary duty to not waste their stockholders' money, Cox's only shareholder that matters is Barbara Cox Anthony, the mother of CEO James Cox Kennedy.
When you're playing with your family's money and you have home turf advantage, swinging for the fences isn't a bad idea. If Cox can carve out a role for itself, perhaps Verizon will feel the heat, especially since most wireless customers stay within a geographic region and aren't nationwide travelers all the time.
With some luck, Cox could shake things up. Verizon vs Google isn't the only exciting story in this.
