Stocks Mixed on Cable, Sprint WiMAX Reports

Investors had mixed reactions Wednesday to news that Comcast Corp. and Time Warner Cable Inc. plan to fund a WiMAX venture that Sprint Nextel Corp. and Clearwire Corp. would run.

At about 12:30 p.m. Eastern, stock in Comcast and Time Warner Cable had dropped. Comcast shares were down 94 cents at $19.60, while Time Warner Cable’s had fallen 83 cents to $25.44.

Sprint and Clearwire’s stocks, on the other hand, had risen. Sprint’s shares had gone up 17 cents to $6.59; Clearwire’s were up $1 at $14.39.

The activity was response to a Wall Street Journal article published late Tuesday. Citing unnamed sources, the newspaper said Comcast wants to invest up to $1 billion in a WiMAX venture with Sprint and Clearwire. Time Warner Cable reportedly would contribute $500 million. Intel is said to be willing to match Comcast’s contribution, while Google Inc. and cable operator Bright House Networks would spend hundreds of millions each, the Journal reported.

Sprint and Time Warner Cable told xchange and PHONE+ the companies were not commenting on the article. Clearwire and Comcast had yet to respond to requests for comment.

The seven-way partnership would build a nationwide WiMAX network to enable fast laptop and cell phone Web connection, faster than speeds seen in today’s 3G networks. It also would revive Sprint and Clearwire’s much-ballyhooed strategy to build and operate a WiMAX network. The companies last November called off their agreement, although both said they’d remain in the market as WiMAX provider hopefuls. In January, talks between the two companies were said to have revived and Tuesday’s news would appear to be the next step in those discussions.

The Journal said the amount of each company's contribution could change, and it is possible the entire partnership could fall through.

Still, it reported that Sprint CEO Dan Hesse is pushing for the seven entities to seal the deal by next week’s CTIA Wireless trade show so he can present the plan to investors. Indeed, such an agreement might well boost investor confidence in Sprint, which recorded a shocking $29.5 billion loss in the fourth quarter of 2007, has seen thousands of customer defections and looks to lose its MVNO relationship with Qwest Communications International Inc.