Comcast, the country's biggest cable operator, and Time Warner Cable, the second largest cable operator, are going to merge and form one huge Kable Kompany in an approximately $45 billion deal. They hope—the deal lacks a "breakup fee" if regulators put the kibosh on the thing (yeah, you know, because it'd be a huge conglomerate). And just listen to the promises!
A press release from both companies says, "This transaction will create a leading technology and innovation company, differentiated by its ability to deliver ground-breaking products on a superior network while leveraging a national platform to create operating efficiencies and economies of scale." Feast on this corporate propaganda:
Through this merger, more American consumers will benefit from technological innovations, including a superior video experience, higher broadband speeds, and the fastest in-home Wi-Fi. The transaction also will generate significant cost savings and other efficiencies. American businesses will benefit from a broader platform, and the Company will be better able to offer advanced services like high-performance point-to-point and multi-point Ethernet services and cloud-based managed services to enterprises. Additionally, the transaction will combine complementary advertising platforms and channels and allow Comcast to offer broader and more valuable packages to national advertisers.
Through the merger, Comcast will acquire Time Warner Cable’s approximately 11 million managed subscribers. In order to reduce competitive concerns, Comcast is prepared to divest systems serving approximately 3 million managed subscribers. As such, Comcast will, through the acquisition and management of Time Warner Cable systems, net approximately 8 million managed subscribers in this transaction. This will bring Comcast’s managed subscriber total to approximately 30 million. Following the transaction, Comcast’s share of managed subscribers will remain below 30 percent of the total number of MVPD subscribers in the U.S. and will be essentially equivalent to Comcast Cable’s subscriber share after its completion of both the 2002 AT&T Broadband transaction and the 2006 Adelphia transaction.
This deal is better for every single American, okay? Because being a big company means things like maybe being able to provide faster internet—or more frustration because it's the only game in town. On the other hand, it might mean you get Comcast's sexy X1 set-top boxes.
Comcast CEO Brian Roberts said, "We believe that this transaction is approvable. It is proconsumer, procompetitive and strongly in the public interest. It will not reduce competition in any relevant market because our companies do not overlap or compete with each other." Still, the combined company would be the biggest broadband Internet provider in America. And will they continue TWC's price-gouging? Or blackout programming in fee fights?
Senator Charles Schumer told constituents, "When I spoke to Comcast this morning, they said 3 things: While there are no hard commitments, they expect to increase Time Warner's cable operation here—just as they did when they acquired NBC—so I expect to see jobs grow; they confirmed they are going to keep NY1; and they confirmed they will honor Time Warner Cable’s commitment to growing jobs in Buffalo. It seems that local jobs, as well as Pat’s 'In the Papers' segment, are not in danger.” Perhaps the best thing that could come out of this deal is the fact that NY1 would go on Verizon FIOS.