PHILADELPHIA _ Comcast and Charter, the nation's No. 1 and No. 2 cable operators, confirmed on Monday a deal to cooperate with each other on their wireless businesses, cutting off, for now, speculation that the country's cable-TV operators and wireless companies would be merging into wireless-cable-internet giants.
In the partnership deal, the companies agreed to seek approval from each other before making any big moves in wireless over the next year. Telecom analyst Craig Moffett called the stipulation a "no-adultery clause."
What it means is that Comcast and Charter would have to approve their competitor's respective plans should one seek to either buy a wireless company or be acquired by a wireless company.
In the telecom equivalent of musical chairs in recent months, rumors have had Comcast buying Sprint or T-Mobile, and Verizon Communications acquiring Comcast or Charter.
Charter's stock fell sharply on Monday morning after the wireless partnership with Comcast was announced. Analysts had considered Charter a more likely acquisition target for Verizon than Comcast.
"The announcement pours cold water on all the various (merger and acquisition) scenarios about which people have so incessantly speculated," Moffett, of MoffettNathanson, said in a research note.
Comcast is expected to launch its Xfinity Mobile wireless product within the next few weeks by reselling Verizon spectrum under the Xfinity brand. Comcast CEO Brian Roberts said he was "excited to work with Charter to explore ways we can make our respective wireless initiatives more efficient and cost effective."
Charter CEO Tom Rutledge said the company has a "tremendous opportunity in front of us in the wireless space. Within our footprint, our network is perfectly suited to provide the data-rich wireless services that customers are increasingly demanding."
Working with Comcast enables Charter to enter the wireless market more quickly, he said.
In 2016, Charter bought Time Warner Cable, then the nation's No. 2 cable operator, after the federal government opposed Comcast's $45 billion deal for Time Warner Cable.
A wireless partnership between Comcast and Charter would encompass the nation's largest cities and millions of Wi-Fi hot spots. It also protects the traditional market boundaries of the cable-TV operators, preventing them from competing with one another for wireless customers.
