June 23, 2004 9:24 AM PDT

Time Warner mulls cell phone business

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CHICAGO--Time Warner is considering entering the cell phone business, a senior executive said Wednesday.

Don Logan, chairman of Time Warner's media and communications group, said the company is exploring possible deals with cell phone providers to add their services to its bundle of cable, data and voice products.

The move, he cautioned, is in its preliminary stages. "We're talking to all the players now," he said, but did not provide specifics.

Time Warner's cell phone dreams may be the result of a battle between the nation's elite cable and local phone companies, which sell bundles of heavily discounted TV programming, local phone service and broadband.

Three of the regional Bell operating companies partly own U.S. cell phone service providers, allowing them to trump their cable competitors by adding cell phone services to some of the bundles they sell to consumers and businesses.

"We know we have to" offer cellular services to compete, Logan said on the sidelines of Supercomm 2004, a telephone industry trade show here.

Time Warner isn't likely to invest billions of dollars and years of time to build a nationwide cell phone network, however. Rather, it's more conceivable that the company will resell an established cell phone provider's service, analysts say.

Such a relationship, known as mobile virtual network operator, has helped traditional phone companies and a diverse group of retailers, including 7-Eleven and U.K. entrepreneur Richard Branson's Virgin, enter the wireless business. It also has allowed Qwest Communications International, the only Bell that doesn't partly own a cell phone provider, to offer wireless.

 

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