HOME     MENU     SEARCH     NEWSLETTER    
NEWS & INFORMATION FOR TECHNOLOGY PURCHASERS. UPDATED 12 MINUTES AGO.
You are here: Home / Mobile Tech / Comcast To Shed 4M Subscribers
Comcast To Shed 4M Subscribers To Help Time Warner Deal
Comcast To Shed 4M Subscribers To Help Time Warner Deal
By Seth Fitzgerald / NewsFactor Network Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
PUBLISHED:
APRIL
28
2014

Comcast is trying to make its proposed $45B acquisition of Time Warner Cable as easy for regulators to approve as possible by giving millions of its customers to Charter Communications.

By handing over 4 million customers to Charter, Time Warner Cable will no longer be the second largest cable provider. Instead, Charter will take that spot, with a total of 5.7 million subscribers.

A Multi-Pronged Deal

Comcast, which announced the plan on Monday, may be losing 4 million subscribers but only 1.4 million of those are actually being handed over to Charter. The other 2.5 million customers will be placed under the control of a completely new publicly traded company. That company, which doesn't currently have a name, will be owned in part by Charter and Time Warner Cable. Charter will have a 33-percent stake in the company whereas Time Warner Cable will have a 67-percent stake.

The primary goal of the deal with Charter is to keep Comcast below a market share of 30 percent. Even though that figure is not legally required, keeping a relatively low market share will at least allow for continued competition in the cable industry.

TWC Acquisition

Comcast's plan to get rid of some of its subscribers and move others around was first announced in connection with its planned acquisition of Time Warner Cable earlier this year. Now that the details have been released, it is even more obvious that Comcast is looking to make it easier for regulators to approve the deal by showing them that the industry will be better if the acquisition goes through.

We caught up with Jeff Kagan, an independent technology analyst, to get his view on the deal between Charter and Comcast and how that deal will affect the much larger acquisition of Time Warner Cable. He told us that it is pretty common for extra deals like these to be made so the regulators will be more likely to give their approval.

"This is what companies do to grease the process. There's nothing unusual about this proposal. The question is, is it enough? There are two problems with regulators," said Kagan. "One is they want to make sure the deal won't harm the industry. Two is they want to see if they can get something from Comcast to sweeten the deal to make the industry better."

Although boosting Charter's market share and decreasing its own might help Comcast get the deal done, Kagan doesn't think it will necessarily be enough.

"This Comcast offer is part of that solution. But I don't think it'll be enough," he said. "So we'll just have to wait and see what the next steps are from both Comcast, and the regulators."

Read more on: Cable, Merger, TV, Video, Acquistion
Tell Us What You Think
Comment:

Name:

Like Us on FacebookFollow Us on Twitter
TOP STORIES NOW
MAY INTEREST YOU
ISACA® offers a global community of more than 115,000 IS/IT constituents in over 180 countries. We develop and deliver industry-leading certifications, education, research and business frameworks. We equip individuals to be leaders in the fast-changing world of information systems and IT - Learn More>
MORE IN MOBILE TECH
Product Information and Resources for Technology You Can Use To Boost Your Business

NETWORK SECURITY SPOTLIGHT
An easily avoided security lapse -- failure to use two-factor authentication on a single server -- is being blamed for the massive computer breach that hit JPMorgan Chase this past summer.

ENTERPRISE HARDWARE SPOTLIGHT
Flying under the radar just before Christmas, HP has launched a new version of its Chromebook 14, most notable for its touch screen and full high-definition display, plus more powerful specs.
© Copyright 2014 NewsFactor Network, Inc. All rights reserved. Member of Accuserve Ad Network.