Time Warner Cable (NYSE: TWC) CEO Rob Marcus sees the MSO's focus on HotSpot 2.0 Wi-Fi access points as "complementary" to a cellular contract, but not likely a replacement, he said during an analysts' conference call this morning.
HotSpot 2.0, Marcus said in prepared remarks, "will make our ever-expanding Wi-Fi network more secure and even easier to use."
It also "makes our HSD (high-speed data) product more valuable," he added later.
That product attracted 148,000 new subscribers in the first quarter--compared to 34,000 who cut the video cord--and is a key element in a TWC challenge to win back a half million DSL customers from telcos by next April, Marcus said. As part of that effort, TWC has deployed close to 33,000 Wi-Fi access points, including 3,000 in the quarter, and allows its subscribers to roam onto Wi-Fi networks controlled by other cable companies, including Comcast (NASDAQ: CMCSA), which is in the process of trying to acquire TWC for $45.2 billion.
That emphasis on hotspots and the roaming agreements have led to some speculation that the cable companies might be positioning themselves for a mobile Wi-Fi network. Comcast executives, in a first quarter earnings call, traipsed closer to that possibility when Neil Smit, president-CEO of Comcast Cable pointed out that a merger "would extend the network further."
Both he and Chairman-CEO Brian Roberts cautioned that it was too early to think of this huge network as anything more than a wireless broadband data convenience for high-speed data customers.
"What we're doing is building out hotspots, doing the routers with dual SSIP, finding our customers are enjoying it. The technology is getting better; more spectrum has been allocated to Wi-Fi and long term I think that we're studying that market and encouraged by it," Roberts said.
Marcus, to an extent, echoed that sentiment.
"We've long said that we thought that the deployment of Wi-Fi access points was a significant value-add for our HSD customers. In particular, our strategy has focused on public Wi-Fi access points, not necessarily in the home or in a particular business," Marcus said.
These access points, he added, replace "some elements of a mobile network (and) that continues to be a tremendous value-add."
Marcus also made it clear that the company's TWC Max high-speed upgrade with top speeds up to 300 Mbps being launched in Los Angeles and New York City is being deployed "very thoughtfully."
"We're always cognizant of the impact of increasing speeds on our various tiers of service and what kinds of downgrade and upgrade activity that might result in," Marcus said. "Certainly, we're not interested in creating cannibalization."
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