Mobile Layer3 TV Acquisition Sends Down Comcast, Cable Stocks

Javier Stokes
December 14, 2017

In what T-Mobile CEO John Legere calls the next phase of their "un-carrier" strategy, the wireless provider announced an acquisition of IPTV pay-TV provider Layer3. Legere says T-Mobile wants to bring the same Un-carrier type disruption that changed the wireless carrier industry to the market for TV providers. "Our vision is to launch a TV service that will work on any device or Internet connection", a T-Mobile spokesperson tells Telecompetitor. But unless he's got a serious rabbit to pull out of his hat, T-Mobile just consigned to join a vMVPD race that is already well underway.

T-Mobile cites the University of Michigan's latest American Consumer Satisfaction Index, which reveals that of the 10 biggest American companies who received the lowest customer satisfaction score in 2017, eight are cable and TV providers.

It's no surprise to see T-Mobile bet more heavily on video. T-Mobile CEO John Legere railed against bundles, "clunky" technologies, closed systems, and awful customer service.

Layer3 offers cable TV, premium channels, streaming online video and other offerings in Los Angeles, Chicago, Dallas/Fort Worth, Washington, D.C., and Denver, where the company is headquartered.

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T-Mobile has announced the acquisition of a small streaming television provider called Layer3 TV, which now operates in five US cities.

Terms were not disclosed, partly because they are not completely finalized, the companies said. "It's time for a disruptor to shake things up and give people real choice like only the Un-carrier can". Layer3's TV packages now start at $75 per month. Financial details were not provided in T-Mobile's announcement, but may be forthcoming.

In addition to the IPTV technology, Layer3 has also taken a modern approach to putting together a TV service in this day and age of Netflix, YouTube, Hulu, and Amazon Prime Video. It's only available in a handful of markets (I'm not in one), but T-Mobile can help it reach more customers, obviously.

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