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Comcast Offers To Shed 3.9 Million Subscribers To Ease Cable Deal
An anonymous reader writes "In a bid to win regulatory approval for its proposed $45 billion takeover of Time Warner Cable, Comcast has offered to sell 1.4 million pay TV subscribers to Charter Communications for $7.3 billion. From the article: 'Comcast also said it would divest another 2.5 million subscribers into a new publicly traded company, dubbed SpinCo for now, to be one-third owned by Charter and two-thirds owned by Comcast shareholders. The deal will make Charter — whose own bid for Time Warner Cable was thwarted by Comcast's higher offer — the second-biggest U.S. pay TV company with 5.7 million customers, overtaking Cox Communications Inc.'"
To think that I was wasting money on bitcoin ... when I should have been trading Comcast users ...
It isn't the subscriber base. It's the control of content creation.
Why do I get the feeling that the Rural locations are going to be part of this group. You know the group that may have miles of cable to maintain, for a less populated group of people. And giving up that group, to the competition prevents them from keeping their costs down, as they are covering more expensive areas to maintain. Thus making them seem less appealing. Causing people in that region to try to get a more affordable service in that area. Thus making Comcast look like the savior coming in to save the day!
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
This is a good deal for those who are getting Charter or Spinco (will be managed by Charter) out of the deal. Charter has a fairly open peering policy https://www.charter.com/browse....
...wherein we find our hero offering to "sacrifice" with petty divestments to "competitors".... as if they'd ever face any true regulatory action - they spent a lot of money on those guys, after all.
I'm sure the people in question don't mind being sold to a different company.
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
I would have modded you up, but just wanted to add that not only is it crappier service, it's more expensive
Geology - it's not rocket science; it's rock science
Does this mean a cable subscriber is worth ~ $5000 to a cable company?
Comcast is trying to spin this as being some kind of big "we won't be a monopoly thanks to this so don't regulate us" concession.
It's effectively carving up the markets between Comcast and Charter, though.
Comcast "gives" Charter 1.4 million subscribers. In addition, Comcast swaps 3 million subscribers in Wisconsin, Ohio, Kentucky, Indiana and Alabama to Charter in exchange for 1.6 million subscribers in "New York, Connecticut, Massachusetts, California, Texas, Georgia, North Carolina, Tennessee, Virginia, Washington, Maryland, and some smaller areas contiguous to existing Comcast or Time Warner Cable systems." [Source] Then, about 2.5 million customers will be served by a new company that is run 2/3 by Comcast and 1/3 by Charter.
Effectively, Comcast is "dropping" about 4.5 million customers but what they are really doing is carving up the market with Charter so that each won't need to compete with the other. They'll each stay in their own little geographic area and everyone is happy. (Where "everyone" means the cable companies, of course. Not the customers who will see higher and higher bills with little to no competition.)
My sci-fi novel, Ghost Thief, is now available from Amazon.com.
Until Comcast gets split into NBC and ISP again, no one will ever support them in expanding their business.
Sure they will...
For the right price.
If you were sold to someone for over $5200, don't you think that they would be thinking about how to get paid back for that "investment"? Where do you think that money is going to end up coming from?. This is a bad deal for everyone who has cable, and indeed a bad deal for everyone who watches TV. It will only serve to drive up cable prices for everyone, and even serve as another incentive to further discriminate against the "free air" viewers.
I'm an American. I love this country and the freedoms that we used to have.
It's ridiculous one company can just 'sell' its customers. Customers should have the choice. This is ridiculous and unfair and shows any semblance of 'regulation' of the field is a joke. Regulation in name only.
How about if I just sell a couple of 'bought' Congressmen? Because they weren't doing much anyway, other than pissing me off.
If this were Usenet, I'd killfile the lot of you.
Really? So we are going to let a company (Comcast) placate the regulators by doing two things? First, by selling some of their customer base to a competitor and then spinning off another competitor. This should NOT happen.
Fist, anytime you have to sell off part of business in a merger to keep the regulators happy it should be a HUGE red flag. It means that you fully realize that your proposed merger is going to create a company that is too large. I hear shades of Microsoft trying to *GIVE* M$ Money to a competitor in order to buy Intuit in a deal that got rejected by regulators (if I recall correctly). Even if the competition is OK with the deal, any horse trading like this should pretty much be considered an admission that the resulting company is too big.
Second, can anybody imagine why you'd want to create some new company when doing a deal like this? Why do they want two separate companies? Usually it is expensive to split a company and unless the two businesses are TOTALLY different kinds of business it usually is more expensive to run two companies over one. So what are they going to gain? One reason they spin off similar companies is to restructure debt and position future liabilities. You take the bad parts of a company (that nobody wants to buy) and spin them off to rid yourself of debt and liabilities, which you dump into the spinoff. So if you see a segment of your business is dying, or the future liabilities are looming (like expensive Union pension plans and older employees) you unload them. Then the child company dies a slow and painful death trying to deal with the debt while the parent lives on.
Both of these actions tell me that Comcast knows that the merger will not be approved so they are grasping at straws in a vain attempt to placate regulators. This merger may still happen, but if it goes though it will be a bad deal for consumers and I'll bet that we find out that Comcast dropped some serious money behind the scenes in the form of bribes, campaign contributions, and lobbying to make it happen. Crony politics are in play and I guess Comcast didn't donate enough to campaign coffers in the last round, or they really need money badly this time around.
"File to fit, pound to insert, paint to match" - Aircraft Maintenance 101