Cox Communications wishes to be freed from earlier MVNO agreement with Sprint

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It seems like there is some development to the ongoing case between Cox Communications and T-Mobile. As reported by Fierce Wireless, the two had some oral arguments in the Delaware Supreme Court this week. 

For some time now, Cox Communications has been planning to start offering wireless service as an MVNO. The only thing that has been stopping them from doing this is the ongoing legal battle it has with T-Mobile. This is because Cox had a legal settlement agreement with Sprint in 2017 that it would go into a provider agreement with the latter if it would offer mobile wireless services. There would be “mutually agreed” terms between the two. 

When T-Mobile acquired Sprint in April 2020, Cox also started a request for proposal from wholesale wireless providers. T-Mo and Verizon both submitted proposals, to which Cox started negotiating with T-Mobile. This, however, did not materialize because Cox did not agree to the wholesale prices demanded by T-Mo. Instead, Cox’s executive team signed a contract with Verizon as its MVNO partner on January 16, 2021. The plan was to launch the new service in three markets on October 15, 2021. 

T-Mobile, however, filed a case claiming that Cox was in breach of contract. It argued in front of the Delaware Court of Chancery that Cox needed to work with T-Mobile. The court ruled in T-Mobile’s favor. 

This led Cox to take the case to the Delaware Supreme Court, where it asked to be off the hook from the contract with T-Mobile. 

“The total cost of Verizon’s proposal was $90 million less than T-Mobile’s ($203 million versus $293 million) and 9% below Cox’s business case, while T-Mobile’s proposal was 32% above it.”

T-Mobile argued this and stated: 

“The Settlement provides that, ‘[b]efore Cox…begins providing’ service as an MVNO, Cox ‘will enter into a definitive MVNO agreement with Sprint on terms to be mutually agreed.’ The court appropriately found that language means what it says: that while Cox is not obligated to begin providing services as an MVNO, if it wishes to do so, it must enter an MVNO agreement with Sprint.’

According to T-Mobile, they are the lawful successors to Sprint. And abiding by this agreement in the first place, they have inherited the settlement agreement terms that Cox made with Sprint in 2017. 

A ruling has not yet been made. 

 

Source: Fierce Wireless

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  • George Salcedo

    T-Mobile is now making Big Red look like the good guys, yikes!

    • Trevnerdio

      Well, a contract is a contract. Though, they should probably ask for a couple mill and just beat it at this point.

    • Brad C

      Verizon is likely asking for less, in concession for Fiber connections to power those mmWave sites, to sell….. 5G Home.

      There’s a lot more that go into these deals than would appear on the surface.

  • steveb944

    I hated Cox cable when I had them. Wouldn’t expect less from an MVNO.

  • Mike

    Cox got there hands caught in the cookie jar, hehe, sounds like they will have 2 companies to be mvno for?
    I dont feel sorry for Cox as they price there services so high, just to get max profit, and from what.this story says would support my statement. They want the lowest cost provider so they can it turn get max profit for the wireless. T-mobile I believe has it correct and should win the case. Now Cox would be out 293 and 203 million if they lose the case. I just wonder for how many years the agreement is for?

  • MissedCall

    Cox. Snicker.

  • This led Cox to take the case to the Delaware Supreme Court

  • Joe

    Don’t like Cox at all. They do this to themselves.