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Cable Companies To Invest In Sprint WiMax Venture

The Wall Street Journal is reporting that Comcast Corp., Time Warner Cable and Bright House Networks are in talks to supply close to $2 billion in funding for Sprint Nextel and Clearwire Corp.'s off-again on-again venture into WiMax technology. The new company, operated by the founders, seeks a total of $3 billion in outside funding--of which Comcast would invest $1 billion, TWC $500 million, Bright House $100 to $200 million, and Intel Corp. and Google, in separate arrangements, would pledge $1 billion and an undisclosed sum, respectively.

Until now, WiMax looked to be dead in the water--as investors, fearing the wireless technology would cost too much, drove down the share prices of both Sprint and Clearwire. The cable companies have now arrived as unlikely saviors, and according to the Journal, the idea has been received with a measure of urgency, as Sprint CEO Dan Hesse says the plan could be wrapped up by next week's CTIA wireless show.

Cable firms have tried and failed to enter the wireless business in the past. In 2006, Comcast, TWC, Bright House and Cox Communications bought $2 billion worth of wireless spectrum in an FCC auction, which they never used. Now, in exchange for funding the WiMax venture, the cable companies would get a stake in the business and be able to offer their own wireless services at wholesale prices.

Read the whole story at Wall Street Journal »

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