Comcast or Charter may buy TWC

[Tiki]

Has anyone else seen this announcement: http://www.bloomberg.com/news/2013-1...ner-cable.html ?

I hate to see the cable giants grow any larger. But then again, the way the markets are carved up now, I don't think there's much competition between the big cable companies (very few areas are served by more than one cable provider). It might actually be good for Time Warner customers, if Comcast relaxes the copy protection flags for them as they do for existing Comcast customers (SageDCT and Cable Card Tuners would work for them then).

Anyone have any other thoughts on this?

[KeithAbbott]

I wonder how this might affect Bright House Network customers. There's always been a strange relationship between TWC and BHN...

[Clift]

I wish this would happen. TWC's policies regarding the cci flag are ridiculous. They copy never every single channel. Where's Comcast is a little more realistic with regard to just copy protection on the premium channels. With Comcast I could actually use SageDCT. It would take time to propagate but whatever...

[Fuzzy]

Charter also only protects premiums (and pay per view and on demand), so either way, this would likely be a win for TWC customers. Charter also has some amazing internet speeds (though of course, when purchasing an existing system, it may take some time before they bring TWC's network up to their current standards).

[pjpjpjpj]

There are no statutory limits on the percentage of customers a cable company could own. In 2009, the U.S. Court of Appeals eliminated an FCC restriction preventing any U.S. cable provider from owning more than 30 percent of the nation’s total subscribers.

My legal memory is fading (since my unused law degree gets farther and farther into distant memory every year...) but I can't believe the SEC isn't concerned about this becoming a duopoly (or two near-monopolies in different parts of the country). Surely this would give the two companies a lion's share of cable service. I guess the SEC lumps cable in with satellite and doesn't see this as a problem due to DirecTV and Dish. I do see a lot of vague mentions in that article about how the splitting of TWC would "avoid lots of issues", and that they don't specifically mention what those issues are; I suspect they are just what I'm talking about.

Nonetheless, they specifically say the move would strengthen their negotiating power against the ESPNs and such... another nail in the coffin of companies like Intel who think they can provide an a la carte pay TV solution. The more power (read: subscribers) the cable companies have, the more they can threaten the big networks like ESPN to not cut deals with "independents".

[Fuzzy]

Originally Posted by pjpjpjpj

My legal memory is fading (since my unused law degree gets farther and farther into distant memory every year...) but I can't believe the SEC isn't concerned about this becoming a duopoly (or two near-monopolies in different parts of the country). Surely this would give the two companies a lion's share of cable service. I guess the SEC lumps cable in with satellite and doesn't see this as a problem due to DirecTV and Dish. I do see a lot of vague mentions in that article about how the splitting of TWC would "avoid lots of issues", and that they don't specifically mention what those issues are; I suspect they are just what I'm talking about.

Nonetheless, they specifically say the move would strengthen their negotiating power against the ESPNs and such... another nail in the coffin of companies like Intel who think they can provide an a la carte pay TV solution. The more power (read: subscribers) the cable companies have, the more they can threaten the big networks like ESPN to not cut deals with "independents".

Even if there were only 2 'cable tv' providers in the entire nation, that would not equate to only 2 television providers. Cable still competes with Satellite (and now other non-CATV providers as well). There are plenty of options out there that are constantly providing downward pressure on television prices. Just look at how many threads there are on this very forum about people 'cutting the cord' and switching to an alternative to CATV. If you don't think that has a downward effect on CATV pricing, you really don't understand economics.

[pjpjpjpj]

Originally Posted by Fuzzy

Even if there were only 2 'cable tv' providers in the entire nation, that would not equate to only 2 television providers. Cable still competes with Satellite (and now other non-CATV providers as well). There are plenty of options out there that are constantly providing downward pressure on television prices. Just look at how many threads there are on this very forum about people 'cutting the cord' and switching to an alternative to CATV. If you don't think that has a downward effect on CATV pricing, you really don't understand economics.

I didn't say anything about effects on cable pricing. I'm just surprised the SEC isn't more concerned about three behemoths becoming two (and maybe they will be, because they won't weigh in until something publicly happens).

Nonetheless, you let me know when you see Comcast, Charter, or TWC dropping their prices because they are afraid of too many cord cutters. CEOs of these companies (along with DirecTV and Dish) are only starting to publicly acknowledge the threat, and even with acknowledging it, they aren't admitting they are worried. It will probably be 5-10 years before any of them really act to counter the movement.

[Tiki]

Originally Posted by Fuzzy

Even if there were only 2 'cable tv' providers in the entire nation, that would not equate to only 2 television providers. Cable still competes with Satellite (and now other non-CATV providers as well). There are plenty of options out there that are constantly providing downward pressure on television prices. Just look at how many threads there are on this very forum about people 'cutting the cord' and switching to an alternative to CATV. If you don't think that has a downward effect on CATV pricing, you really don't understand economics.

Of course TV is just one of about 3 services that most cable providers offer (phone and internet being the other two). So, it's important to also consider the effects on those other markets (particularly internet service).

There are currently only a handful of options for internet access and they don't really compete on level footing:

• Cable
• Fiber to the home (FiOS, Google Fiber, etc.)
• DSL
• Cellular (LTE, etc.)
• Satellite
• Dial-Up

Cable and Fiber are very fast, but most people in the US do not have access to Fiber, and not everyone can even get cable. DSL tends to be faster than Satellite or Dial-Up, but much slower than Cable or Fiber. LTE can be very fast (almost as fast as Cable), but coverage is not universal, its pricey, and has very low bandwidth caps (the service offered by most cell phone providers is not really intended to be a primary internet link for a home or business).

Even with very little local competition between cable companies, actions by one provider do have some affect on what others providers do. One area where this could become an issue is bandwidth caps / metered connections. If Time-Warner goes away, we may see the remaining cable operators accelerate their roll-out of caps and metered connections.

[Fuzzy]

Originally Posted by pjpjpjpj

I didn't say anything about effects on cable pricing. I'm just surprised the SEC isn't more concerned about three behemoths becoming two (and maybe they will be, because they won't weigh in until something publicly happens).

Nonetheless, you let me know when you see Comcast, Charter, or TWC dropping their prices because they are afraid of too many cord cutters. CEOs of these companies (along with DirecTV and Dish) are only starting to publicly acknowledge the threat, and even with acknowledging it, they aren't admitting they are worried. It will probably be 5-10 years before any of them really act to counter the movement.

The whole POINT of SEC regulations/watchfulness is to foster competition, which is a direct contributor to pricing - so yes, you DID bring up pricing - and cable tv pricing, compared to services offered, HAS decreased over the last 10 years, especially when you consider it as percentage of total consumer spending over those 10 years.

You have to realize that while yes, you pay more for your cable service you have now than what you had then, what you are paying for is a completely different animal - even if you don't realize the difference.

10 years ago, a city's cable system consisted of a single head end, and a series of distribution amps spread throughout the city, broadcasting the same signal to all taps in the city. Demand for faster internet, and more HD channels, however, has greatly increased operating/maintenance costs of the system. Instead of a single head-end distributing to an entire city, the city has to be broken up to 10's or 100's of individual systems, all networked back to the head end via high speed fiber. This is a much greater and complex system to operate and maintain - which is why they try to cut operating costs where they can, like eliminating unencrypted channels to avoid cable theft via authorization, instead of rolling a truck to install/remove filters.

Comparing what you are paying for now is in no way related to what you paid for 10 years ago.

[Tiki]

Originally Posted by pjpjpjpj

Nonetheless, they specifically say the move would strengthen their negotiating power against the ESPNs and such... another nail in the coffin of companies like Intel who think they can provide an a la carte pay TV solution. The more power (read: subscribers) the cable companies have, the more they can threaten the big networks like ESPN to not cut deals with "independents".

I think this is really the biggest concern. But it goes beyond the obvious idea that Comcast and Charter would become bigger cable companies. The other (probably more important) aspect is that Comcast, TWC, etc. are also media companies. They own many of the networks. And the more networks they own, the tighter the grip they can maintain when it comes to negotiating how channels will be bundled, how much they will charge their competitors (Dish, etc.) for transmission rights, and whether they will allow certain potential competitors (Intel, Apple, Sony, Amazon, Netflix, Hulu, etc.) to even carry their content.

[pjpjpjpj]

Originally Posted by Tiki

I think this is really the biggest concern. But it goes beyond the obvious idea that Comcast and Charter would become bigger cable companies. The other (probably more important) aspect is that Comcast, TWC, etc. are also media companies. They own many of the networks. And the more networks they own, the tighter the grip they can maintain when it comes to negotiating how channels will be bundled, how much they will charge their competitors (Dish, etc.) for transmission rights, and whether they will allow certain potential competitors (Intel, Apple, Sony, Amazon, Netflix, Hulu, etc.) to even carry their content.

Yup, which is one of the reasons why I have said all along that a la carte pay TV service won't be here any time soon (barring government intervention), if ever.

[pjpjpjpj]

Originally Posted by Fuzzy

The whole POINT of SEC regulations/watchfulness is to foster competition, which is a direct contributor to pricing - so yes, you DID bring up pricing - and cable tv pricing, compared to services offered, HAS decreased over the last 10 years, especially when you consider it as percentage of total consumer spending over those 10 years.

You have to realize that while yes, you pay more for your cable service you have now than what you had then, what you are paying for is a completely different animal - even if you don't realize the difference.

Wow, Fuzzy, this is quite a convoluted argument you are making. I don't even know how to unravel it and address it with respect to my original point.

Let me just take it to this basic point: do you really think Comcast and Charter becoming even bigger and more powerful (while eliminating the only other cable provider that's really an equal competitor) is good? That it fosters healthier competition? That the "content provider" market will be better, more open, more fairly competitive, for it?

I've never met anyone who thinks cable companies are anything other than greedy, cut-throat money-grubbers. And if you think this proposed purchase is anything other than a massive power and money grab... well, then it's not even worth debating with you.

[rochurch]

Originally Posted by Clift

I wish this would happen. TWC's policies regarding the cci flag are ridiculous. They copy never every single channel. Where's Comcast is a little more realistic with regard to just copy protection on the premium channels. With Comcast I could actually use SageDCT. It would take time to propagate but whatever...

Wow, this IS exciting! I am a TWC customer in the same boat.

[Fuzzy]

Originally Posted by pjpjpjpj

Wow, Fuzzy, this is quite a convoluted argument you are making. I don't even know how to unravel it and address it with respect to my original point.

Let me just take it to this basic point: do you really think Comcast and Charter becoming even bigger and more powerful (while eliminating the only other cable provider that's really an equal competitor) is good? That it fosters healthier competition? That the "content provider" market will be better, more open, more fairly competitive, for it?

I've never met anyone who thinks cable companies are anything other than greedy, cut-throat money-grubbers. And if you think this proposed purchase is anything other than a massive power and money grab... well, then it's not even worth debating with you.

Business IS a money grab - you're foolish to ever think otherwise. And I do not feel that inter-cable-co competition has near as much to do with customer pricing as does competition between cable co's and satellite. Many on here are always quick to point out that the only have a single cable provider in their town - what provider exists in the town next door has no bearing no them. All I see this subject being is about TWC's demise, due to it's horrible customer service policies over the last 8 years. Not many companies have to go on a massive apology marketing campaign, and then thrive afterward. TWC is going to fail - there's not much changing that at this point. It's just a matter of who purchases the scraps.