Charter Communications’ assumption of the facilities and personnel of Time Warner Cable in Louisville and numerous other markets is edging closer to finality. As proposed, the order outlines a number of conditions in place for seven years that will directly benefit consumers by bringing and protecting competition to the video marketplace and increasing broadband deployment.
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US officials are trying to protect the growing market for online video services and have moved to prevent cable companies from thwarting distribution of content by entertainment companies over the Internet. The goal is to keep things competitive by not punishing users for using services like Netflix, HBO GO, Hulu, and so on.
“After a lot of creative thought, we’ve made a decision to call the new company, Charter”, quipped Rutledge on the company’s quarterly earnings call. The flip side is that the ban forces Charter to spread those users’ costs onto its entire customer base, which rules out the possibility of light users paying lower monthly rates. The commission would also require Charter not to charge Internet streaming companies for access to its customers.
TWC stock closed Wednesday at $209.03, down $1.81 per share, or 0.86 percent.
That’s about as bland a statement as a company can make, but the FCC would probably not appreciate it if Charter started dancing in the streets, or if the company said anything more boastful. Final approval from the full FCC and from a California utility – a separate approval of the arrangement in California is apparently required – are still needed but expected to be completed by late May, Charter officials said.
This was a clear win for Charter, which is probably at least a slight win for Time Warner Cable customers.
The Philadelphia based company said the revenue came from the 53,000 pay-TV subscribers added to the customer base of the company in the recently passed first quarter of the year. In addition, while the conditions placed on the deal were mild, forbidding data caps and usage-based pricing does stop New Charter from a practice Comcast is slowly rolling out.
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Charter Communications Inc. and Time Warner Cable recently announced that the shareholders of both the companies have approved all proposals associated with their merger.
