The Street reports that the $45.2 billion deal bringing Time Warner Cable into the Comcast fold will make the Comcast CEO the dominant player in the pay-TV market. If approved, Comcast will control over roughly 32% of the country’s cable-TV market. More importantly, Comcast will have a firm hold in three more metros with National Football League teams: Charlotte, New York and Dallas. It will also add 8 million potential subscribers to Comcast-owned cable networks.
From the story:
“For Roberts, the deal that combines the two largest U.S. cable-TV providers is yet another step toward the unlikely ascendancy of the Philadelphia-based Comcast into one of the country’s most influential media and entertainment companies. That Roberts outmaneuvered or simply outmuscled John Malone, the billionaire behind Charter Communications (CHTR) who all but created pay-TV, only adds to the drama.
‘Brian Roberts’ father should be very proud today,’ Leo Hindery, a private equity media investor and former CEO of Tele-Communications Inc., which merged with AT&T in 1999, said in a phone interview. ‘Roberts has proven once again that his position in the cable industry is one of great integrity and superior management. Not everyone’s son turns out to be so good.’
Comcast started small as American Cable Systems, which Brian’s father Ralph Roberts helped form in 1963 before changing its name six years later to combine the words ‘communication” and broadcast.’ While its focus was largely in the mid-Atlantic, the father-son combo audaciously acquired AT&T Broadband in 2001, catapulting Comcast into the lead among cable-TV providers.”
Here’s a chart from SNL Kagan, which notes in a report that Comcast would have 30.1 million subs as of year-end 2013 if it were to divest 3 million subs, as it has indicated willingness to do — well above DIRECTV’s 20.2 million and DISH Network Corp.’s 14 million. Should the deal be approved, Charter is likely to bid for at least some of the divested subs.
Comcast was keen to become not just a provider of media entertainment but a producer as well. In 2009, the Roberts’ got their wish, buying 51% of NBC/Universal from GE, and then last year, acquiring the remaining stake in the television and film company, noted The Street.
“They’ve been opportunistic but they’ve also been capable of unexpected moves such as this one,” SNL Kagan Senior Analyst Robin Flynn told The Street. “Comcast hasn’t surprised investors in a negative sense — they’ve really done what they told investors they would do.”