T-Mobile US ( TMUS ) on Wednesday said it has agreed to acquire Layer3 TV, co-founded by a former chief technology officer at Comcast ( CMCSA ), as part of its plan to launch a mobile TV service in 2018.
[ibd-display-video id=3021480 width=50 float=left autostart=true] Terms of the acquisition of Denver-based Layer3 TV were not disclosed. David Fellows, former Comcast chief technology officer, co-founded Layer3 TV with Jeffrey Binder in 2013. Binder earlier started Broadbus Technologies, a video-on-demand company.
Layer3 TV has been selling a cable-TV-like service that starts at $75 monthly in five markets. The company does not bill itself as an internet video provider such as Hulu or Dish Networks' ( DISH ) Sling service.
However, Layer3 TV's service does require broadband connections to homes. Layer3 TV says it uses private IP technology to deliver the service.
T-Mobile says it will provide Layer3 TV's video service over its nationwide 4G wireless network.
IBD'S TAKE:With today's gain, T-Mobile stock is up nearly 12% in 2017. The stock had been up 20% as of May amid speculation T-Mobile would agree to merge with Sprint. Talks fell apart in November. Currently in a double-bottom base, T-Mobile has a technical buy point of 65.57 but is a laggard with a Relative Strength rating of 45. Learn more at IBD Stock Checkup .
Shares in T-Mobile rose 0.6% to close at 63.83 on the stock market today . Comcast fell 2.4% to finish at 38.58. Charter Communications slipped 0.3% to end the regular trading session at 329.
T-Mobile's plans may create more competition for AT&T, too. AT&T says its DirecTV Now online video service, also available to its wireless customers, has more than 1 million subscribers. Shares in AT&T lost 0.2% to 38.04.
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