Sprint MVNO Scratch Wireless crafting Wi-Fi-centric service for cable operators

Sprint (NYSE: S) MVNO Scratch Wireless is developing a version of its Wi-Fi-centric service specifically for cable operators that want to leverage Wi-Fi so they can compete against cellular carriers.

Scratch co-founder and CEO Alan Berrey revealed during a webcast presented jointly with Multichannel News that Scratch is in "active discussions" with cable operators. He said pilots of a tailored "Wi-Fi First" service could begin this summer, followed by actual deployments in the fall.

Berry contends cable operators are getting a "pretty one-sided deal" when cellular data traffic is offloaded onto Wi-Fi, which often is enabled by their fixed broadband networks. Cable MSOs "seem hungry for a solution and a way to compete in the mobile space," added Berry, whose remarks were quoted in a Multichannel News article.

Scratch began offering a direct-to-consumer Wi-Fi-based service earlier this year. Voice and data services are free when a user is on Wi-Fi, and texting is free all of the time, regardless of whether a customer is on Wi-Fi or the Sprint cellular network. As with fellow Sprint MVNOs Republic Wireless and TextNow, Scratch customers who are out of Wi-Fi range roam onto Sprint's network under a pay-as-you-go model.

Scratch's service currently supports only the Motorola Mobility Photon Q handset running a modified version of Google's (NASDAQ: GOOG) Android 4.1 (Jelly Bean) OS. The smartphone sells for $269.

Scratch estimates its customers are connected to Wi-Fi networks 84 percent of the time, and that is without any formal access deals between Scratch and other wired broadband providers.

Cable operators increasingly see Wi-Fi as their ticket to competing directly against cellular operators, though Wi-Fi's limited hotspot footprint and restricted coverage range means a full nomadic service would likely require a cellular backup, much as Scratch already offers over the Sprint network.

As evidence of  cable's growing focus on Wi-Fi, Time Warner Cable (NYSE: TWC) recently confirmed its rollout out of "TWCWiFi-Passpoint," a national Wi-Fi network that includes Hotspot 2.0 technology on most of its public access points as well as upgraded encryption.

Rival cable MSO Comcast (NASDAQ: CMCSA) is planning to add Hotspot 2.0 technology to its growing, Xfinity-branded public Wi-Fi network as well, though it has not provided a specific timeline. Comcast, which has bid $45.2 billion to take over Time Warner, also is eyeing the launch of a Wi-Fi-centric wireless service.

In related news, another cable MSO, Charter Communications, announced that as of May 16 it will begin rolling out 802.11ac-enabled routers to its broadband customers. The company said the Netgear-supplied router is capable of delivering more than the maximum 100 Mbps offered by Charter Internet Ultra service.

The Financial Times reported that Comcast and Time Warner, in an effort to win approval for their merger, are in early-stage negotiations to sell up to $20 billion worth of assets to Charter. The proposed deal would involve divesting between 3 million and 5 million subscribers to Charter.

All three MSOs are members of the CableWiFi consortium, along with Bright House Networks and Cox Communications. The companies allow each other's high-speed Internet customers to access more than 200,000 Wi-Fi hotspots.

For more:
- see this Scratch webinar landing page
- see this Multichannel News article
- see this Charter release
- see this Financial Times article (sub. req.)
- see this Verge article

Related articles:
Time Warner announces massive Hotspot 2.0 deployment
Confirmed: Hotspot 2.0 is on Comcast's roadmap for its Xfinity Wi-Fi network
Comcast Wi-Fi hotspots reach 1M milestone
Report: Comcast thinking of launching a Wi-Fi-centric wireless service
Sprint MVNO Scratch Wireless starts offering 'free' Wi-Fi-based service

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