Cablevision prepares to launch Wi-Fi-exclusive Freewheel service

Cablevision (NYSE: CVC) announced the soon-to-be-launched Freewheel, its Wi-Fi phone service with unlimited data, talk and text, marking the first all-Wi-Fi service from a cable provider. Offered initially with the Motorola Moto G smartphone, it will work exclusively over Wi-Fi when it launches next month.

Motorola Moto G

Motorola's Moto G, offered with Cablevision's Wi-Fi service.

While other companies have sought to fall back onto cellular networks when Wi-Fi is not within range, Cablevision COO Kristin Dolan told The Wall Street Journal that Cablevision isn't doing that. The Freewheel service won't work well for the consumer who's on a conference call while driving to work, but will appeal to other types of consumers, like college students on campus or fixed-income families. "When you're connected to Wi-Fi, it works better than cellular," Dolan told the WSJ.

Cablevision began deploying its Wi-Fi network in 2007 and its Optimum WiFi is now available at 1.1 million access points, with both indoor and outdoor locations and an expanding network of residential hotspots. The network covers Cablevision's home operating territory in the New York metro area, where Freewheel will be heavily marketed, but service will be available nationwide, although in some cases, consumers may have to pay to access hotspots outside Cablevision's network.

Freewheel will cost $9.95 per month for Cablevision's Optimum Online customers and $29.95 per month for non-customers. The price for non-Cablevision customers is more expensive than some comparable Wi-Fi-first plans--which include cellular service--from other providers, including Sprint (NYSE: S) MVNO Republic Wireless. It was not immediately known whether or to what extent the Optimum service is Hotspot 2.0 compatible.

The New York Times notes that while industry analysts have long expected cable operators to roll out Wi-Fi mobile phone service, the Cablevision product is being offered sooner than many of them had predicted. Cablevision chose not to partner with a wireless carrier--at least for now--or build its own wireless network to fill gaps in service when Wi-Fi connections were not available, the Times said.

Cablevision's Freewheel launch represents the boldest step yet by an MSO to directly challenge wireless carriers in the mobile services market. For more, see this press release, this FierceWireless article and this FierceCable article.

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