Time Warner to key into mobile phones

Time Warner, the world's largest media group, is in talks to offer a mobile phone service over the phone group Sprint's network on a trial basis early next year, a source said.

A deal would allow Time Warner Cable, a unit of the US group, to offer television, high-speed internet access, and a traditional and wireless phone service. Time Warner Cable and Sprint confirmed they were in talks but declined to discuss timing or other details.

Several big providers of cable television are mulling grander ambitions to work together to offer wireless services. Time Warner Cable, Comcast, Cox Communications, Charter Communications and several others are in a consortium.

The source said the consortium has hired the investment bank, Merrill Lynch, to investigate opportunities in the wireless arena that may include an acquisition, although an expensive purchase is unlikely.

Adding wirelessto cable services will help Time Warner distinguish its services from those of rivals vying to break into the video services market, analysts say. Jeff Kagan, an independent telecommunications industry analyst, said: "We are going to see most of the cable companies start to sell wireless services in 2005, but they will resell an existing provider, not install their own networks."

Sprint, which this month agreed to buy Nextel Communications for $35bn (£18.3bn), is a natural partner as it has established similar ventures with other companies. It operates a joint venture with Virgin Group, targeting the youth market. Nextel operates Boost Mobile, which is aimed at a similar audience.

The initial Time Warner Cable trial would start in Kansas City, Missouri, in the first quarter of next year.