Comcast and Time Warner Cable’s $45 billion merger puts 30 million customers under one roof
It’s official: Confirming the leaks from last night, Comcast has announced it will acquire Time Warner Cable. This combination of the country’s #1 and #2 cable companies will stretch from coast to coast, as TWC controls markets like New York City, LA and Texas, while Comcast strongholds include Philadelphia and Washington DC. TV isn’t the only medium in play either, since as Gigaom points out, the two companies together cover not only 30 million+ cable TV subscribers, but also around the same number of internet connections, and about 15 million phone lines. So, what’s the likely impact for customers as a result of the deal? For several reasons the answer right away is “not much.”
It will take time for the combo to gain regulatory approval from the FCC and Justice Department, like the lengthy acquisition process we saw when Comcast snatched up NBCUniversal a few years ago. Despite that, both parties expect the deal to close by the end of this year. As part of the announcement, Comcast says it’s “prepared to divest systems serving approximately 3 million managed subscribers,” and expects to gain about 8 million net subscribers with the move. Comcast is still trying to roll out its new X1 TV platform including cloud DVR access, while Time Warner Cable brings its own setup, complete with StartOver and LookBack VOD features that let viewers go back in time without a DVR.
Just like Charter with its failed bid for TWC, Comcast thinks it can negotiate better rates with the studios and channels that provide it content with a larger customer base. Another benefit is the ability to efficiently deliver highly profitable high-speed internet and phone service, although we’d be shocked to see our bills go down at all as a result. Bloomberg reports Charter and Comcast had been working on a combined offer for TWC, but that’s rumored to have fallen apart last week. Surprisingly, TWC has an even lower reputation with customers than the much-maligned home of Xfinity, so in that respect, perhaps things can’t get much worse?
The other issue comes back to the control of internet access, with network neutrality and metered service hanging in the balance — while Comcast has experimented with various levels of data caps, Time Warner Cable has not, and the two also differ in their treatment of HBO Go on Roku and Samsung devices. Several conference calls are scheduled today so the companies can make their case — public interest groups like Free Press are already opposing the move — we’ll be listening intently for explanations on why moving from “cartel partners” to a single offering is a good thing for anyone.
Filed under: Home Entertainment, Internet, HD
Source: Comcast, Time Warner Cable
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