By Kim Hart
Washington Post Staff Writer
Tuesday, April 17, 2007

Cox Communications announced plans yesterday to launch wireless service in Fairfax County and Fredericksburg, becoming the first company in the region to add cellphone service to its cable TV, phone and Internet packages.

Cellphone service is the latest front in the battle between cable and traditional telephone companies, which are both trying to capture their consumers' communications business. As phone companies invade cable's territory by offering television, Cox is one of four cable operators fighting back by rolling out cellphone service powered by Reston-based Sprint Nextel.

Bundles that add wireless have been dubbed "quad play," a follow-up to the "triple plays" that combine digital cable, phone and Internet services in discounted packages.

Cable giants Cox, Comcast, Time Warner and Bright House Networks have spent $200 million to market the Pivot service with Sprint in eight U.S. markets and plan to extend the offering to 40 markets by the end of the year, said Kevin Packingham, vice president of products and marketing for Pivot at Sprint.

Northern Virginia is the third market in which Cox will be offering the quad play, following San Diego and Phoenix. The wireless service will be available by early fall throughout Fairfax County, except in Reston, where Comcast offers service, as well as in Fredericksburg and in Stafford and Spotsylvania counties.

Being the first to enter the local market will be beneficial for Cox, but the company is likely to encounter fierce competition in the future from Verizon and other phone companies offering similar packages, said Michael Cai, director of broadband and gaming at Parks Associates, a Dallas telecommunications market research firm.

Nationally, cable companies are already competing with phone companies with quad-play bundles in some markets. Cai said Cox may find it difficult to counter competing offers if it must negotiate changes with not just Sprint but also its other partners.

The partnership "may not work as well because there are several companies involved . . . and they won't be able to make decisions as quickly," Cai said.

With the Pivot service, subscribers would be able to watch video and check e-mail from their cellphones, make unlimited calls between their cellphones and home phone lines, and receive text alerts whenever a voice mail is left at their home number. All fees would be bundled into one bill.

Although the Pivot package works with all Sprint cellphones, cable companies are offering a limited number of handsets, which may not appeal to consumers, Cai said.

Packingham said he expects the partnership to "incrementally" attract new subscribers for Sprint, which has been steadily losing high-paying customers for the past two years.

"We feel the worst part of that is behind us," he said. "Pivot is one of the many steps Sprint is taking to retain customers."

Analysts predict that consumers will be slow to adopt the quad-play plans. At the end of 2006, fewer than 1 million people subscribed to such plans, while 11 million used triple-play services. Triple-play subscribers are projected to outnumber quad-play customers by about 3 to 1 in 2010, according to Parks Associates.

Cox said about 25 percent of its customers subscribe to its triple-play bundle of services, which has been available in Northern Virginia for two years.

Stephen Bye, vice president for wireless at Cox, said it may take some time for consumers to warm to phones that work in conjunction with other telecommunications services. "It's a very complicated product. . . . Is the customer ready for that experience?"