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Charter Strikes $56B Deal For Time Warner Cable
mpicpp writes with word that Charter Communications has struck a $56 billion deal to buy Time Warner Cable; if the deal goes through (which the article says is likely, according to Macquarie Research analyst Amy Yong -- at least more likely than the recently scotched Comcast-Time Warner deal), it would mean that the second- and third-largest U.S. cable companies would share a letterhead, and more than 20 percent of the country's ISP market.
From the linked Reuters article: The Federal Communications Commission immediately served notice that it would closely scrutinize the deal, focusing not only on absence of harm but benefits to the public. Charter, in which Malone-chaired Liberty Broadband Corp owns about 26 percent, is offering about $195.71 in cash-and-stock for each Time Warner Cable share, based on Charter's closing price on May 20. Including debt, the deal values Time Warner Cable at $78.7 billion. A key area of regulatory concern would be competition in broadband Internet.
Surely Time Warner has learned the lesson of not being bought for funny money stock?
Because when AOL bought them with trumped up stock, somehow AOL was worth more than an entity with cable, programming,network infrastructure, move studios.
Somehow I wonder if Time Warner isn't selling the farm for a couple of magic beans (again).
And you can bet your ass this single entity will not do anything to lower prices or foster competition ... it will be more "we're screwing you because we can".
The only people this will be good for are executives who get huge severance packages. But I'm betting in the long run it hurts consumers, and quite possibly shareholders.
Lost at C:>. Found at C.
The merger is a bad idea, Charter is a poorly managed company and has been for a long time. Management treats their technical employees with callous disregard for personal boundaries, does not recognize or reward technical expertise or professionalism and in my case, is in the habit of lying to job reference inquiries to the point of being criminal. This is just scratching the surface of what is wrong with this company. As an internet service provider, they are sub standard in terms of providing working, reliable equipment and they are notoriously slapdash with protecting their customer's privacy and options to protect their own privacy.
My bad experience at the company aside, if an entity cannot handle and demonstrate integrity in small things, it follows that they should not be trusted with larger responsibilities.
Timing is rather interesting on this one...
No, you can't merge with Comcast. That would be too big of a company....suuuure, you can merge with Charter! That's fine.
What the hell is wrong with the FTC?!
My view is they should split up the infrastructure and the content providers.
Perhaps the municipal governments having control of the infrastructure, and we can have a choice of ISPs and other content providers.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
According to ASCI's 2014 poll of Internet Service Providers (see coverage by Ars), Time Warner had the lowest satisfaction of all broadband companies (54% and dropping faster than any other company). Comcast was 2nd-worst (57% and dropping 2nd-fastest), and Charter was 3rd-worst (and dropping 3rd fastest). So, this may lessen Time Warner's decline.
Personally, I have used both companies for coax services in the DFW area, and I prefer Charter. Business services are similar, but Charter is much cheaper (currently $40/mo promo for 60M/4M versus Time Warner at over $300/mo for 50M/5M). Time Warner's aging infrastructure in Dallas definitely does not warrant the premium. Plus, Charter service is no-contract.
This has been my proposal for a while now. It would solve, or at least provide choice in "Net Neutrality" issues, like that of Comcast v Netflix.
The problem is that nobody really wants to tackle the FIOS rollout that would be needed to make this work. However, I do believe it would work, and a small municipality, one that is geographically isolated, would be a great case study in how it would work.
The thing I believe most about this scenario is that we'll start to see new products and new services that are currently missing like "a la carte" ordering.
Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
If there are currently fewer than 3 options for services in any areas they are proposing to merge or if their merger would drop the competition
Cable companies do not share their infrastructure, and they usually have exclusive "franchise" agreements with municipalities. Are there actually any areas where buying service from your choice of Time Warner, or Charter was an option?
I believe this in the past has been the big cable co's argument that mergers between companies servicing different areas don't reduce competition.
They already have the monopoly..... the only way to switch is to move house. Would anyone actually move house to switch cable carriers?
It's easy to be cynical about this, but Time Warner is so customer surly that a ultra-huge mega-merger might actually be better for existing Time Warner customers.
For example: Time Warner abuses the broadcast flag / CCI DRM schemes to flag everything they legally can as "copy-once", locking out lots of DVR competition because the additional features don't work. Charter does not do this, and only flags content as "copy-once" or "do-not-copy" as contractually required by the content providers.
A Charter merger with Time Warner would make my service better and more enjoyable the instant they flip that bit to comply with Charter's current policy regarding CCI tagging because I would no longer be required to watch content only on the device that recorded it.
Time Warner is the worst cable company out there from a customer perspective. When the best news you get about someone providing you a service is that they are selling out to competition, that tells you how bad the service is.
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The problem is that nobody really wants to tackle the FIOS rollout that would be needed to make this work. However, I do believe it would work, and a small municipality, one that is geographically isolated, would be a great case study in how it would work.
Hello, I'm in Chattanooga, TN. Our electric utility has run fiber on its existing power poles.
They haven't expressly set it up to have independent ISPs, but the fiber? Done. The other part? Would be at the head-end and maybe the ONTs, it would be easy to arrange.
Of course, in large part, it was actually done by a private contractor, Adelphia, I believe, but I've not seen their trucks in a good while, so I don't know for sure, I may be misrecalling the name. A-something anyway.
Yea, letting the government manage the high tech infrastructure is a recipe for success, not!
Why do you presume that the government would be any less effective than corporations? This meme that government is automatically incompetent is tiresome and demonstrably false in numerous circumstances. I have precisely one practical ISP option where I live (Comcast) and I assure you that their customer "service" is less than amazing and their prices are not even close to cheap. Would a government run ISP be any worse? Maybe, maybe not. I could see it going either way. Your assumption that they would be automatically incompetent "because, government" is both unproven and illogical. Government tends to be a good choice for things where market incentives break down, including infrastructure. Guess what? Market incentives aren't getting the job done in the ISP market for a lot of people. I have to pay a lot of money for a relatively slow connection to my choice of a single company. I doubt the government would be any worse to be honest.
Can you imagine how responsive a government run infrastructure would have been to say the Netflix issues that plagued Verizon customers?
I can imagine it potentially being quite a bit better since the government wouldn't be trying to chisel Netflix out of a cut of their profits. Corporations, particularly monopolies are noted for being less than responsive. And in fact we have to have government oversight of them precisely because the company's profit motive tends to conflict directly with incentives for good customer service.
Maybe what's needed is to separate the "providers" from the companies that own the infrastructure.
That's a good idea but it doesn't fully address the problem. Infrastructure companies would still be tempted to charge a "toll" to prioritize traffic so regulation or competition is needed. Since competition is a practical impossibility in a lot of places (expensive to have multiple wires to rural locations) then regulation becomes necessary.
Government is NOT the answer in most cases
Most cases of what? Infrastructure? Government is the ONLY practical solution for a wide array of infrastructure projects. Roads, airports, passenger rail, ports, are all done primarily through governments. Telecom companies and utilities are typically private but heavily regulated. Power generation? Regulated. Bridges and dams? Regulated and contracted out. The blanket assertion that government is never the best option is not supported by the actual facts. Governments are often the best solution for when market incentives fail and they often fail in infrastructure which is what the internet has become.
Having government manage a rapidly change highly technical bit of infrastructure does not seem like a good idea to me.
That's why governments rarely do such things themselves. What happens is you pay taxes to the government and the government contracts out the services to a competitive bidding process among private companies. The government doesn't pave your roads (usually), it manages the company that does. The advantage of this is that the government's incentives are (more) aligned with the taxpayer and it provides a means to accomplish things that otherwise either wouldn't get done or would be done insufficiently or badly if profit motives were the only factor in play.
I have plenty of choices where I live. I can choose from Time Warner Cable, Time Warner Cable, Time Warner Cable, or even Time Warner Cable!
My sci-fi novel, Ghost Thief, is now available from Amazon.com.
Honestly... my experience with Charter was nothing short of great. Their pricing was better than my alternatives, I got decent speed which was doubled at one point without a price increase, and my customer service experience was pretty good. Had I not moved, I would probably still be a customer of theirs.
As to whomever owns the poles or conduit, I'm not saying they shouldn't be compensated for permitting someone to run cable. Be reasonable about it. But do not obstruct it either.
Here people say "but it would be messy with all those wires"... it won't be messy if it is just a couple companies doing it. If it is a lot more than that, then you'll be collecting enough money in fees to convert from poles to conduits at which point the way it looks will be irrelevant.
As to private developments allowing people to lay cable... depends. They often are in exclusive agreements to only let company X run cable.
Here is the thing, what would it cost in materials to run fiber from your house to the trunk? If you're in a major city, then you're usually less than a couple miles from place you could click right into the backbone. what does a couple miles of fiber cable cost? Peanuts.
The reason we have so much dark fiber is because they determined that the labor was more expensive than the cable so they just installed way more than they needed so they could just exploit unused cable for years instead of having to go out and lay more every few years.
The cable is cheap.
The labor is also pretty cheap.
The thing holding it back is that you're literally on pain of getting shot in the face not allowed to do it.
Stop stopping people from running cable and we'll all have gigabit internet by christmas.
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Government is rather good at infrastructure. Companies are not so good at it. Why do you think Cable Companies are so bad in terms of customer support. Because they need to manage this infrastructure. That means they will keep the more profitable zones in better condition, or zones where they have some competition with. But in other areas where it is a profit loss zone, or they know customers don't have an alternative, they will just do the bare minimum. Government infrastructure seems to value the last mile user a bit more. Making sure they get their coverage as well.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
I wonder what the legal cost of even attempting this merger is above and beyond the cost of acquiring assets/debt. Though I guess it's not nearly as much as a they gain by grabbing the huge monopoly if it goes though.
Doesn't matter. The consumer ends up paying for it in the end.
I honestly wish these mega-mergers in cable would just be stopped. Flat out.
And before someone starts quoting combined numbers of Comcast+TWC vs Charter+TWC, understand this. The final number of subscribers is largely irrelevant due to geographic monopoly.
We have enough of these mega-monopoly ISPs as it is. And all the mergers do is concentrate the money so they can afford bigger and bigger bribes to buy a permissive atmosphere in which the best interests of consumers/constituencies are not looked after.
And the only recourse? Try to vote out these money-grubbing incumbents with their newly marble-lined solid platinum warchests...
Chas - The one, the only.
THANK GOD!!!
I don't think anyone hates Comcast because they're number 1. People hate Comcast because they're Comcast.
Ignorance killed the cat. Curiosity was framed.