For 15 months execs at Comcast were all but certain that their $45 B bid for Time Warner Cable would succeed. This acquisition attempt died a quick death on April 23, 2015. What happened and what can we learn from it?
On the surface it appears that the US regulators, in this case the FCC and the DOJ simply don’t like mega mergers that are so obviously a no-win for consumers. Comcast went in with some pretty weak arguments.
The simple truth was that Comcast would emerge with 57% of the US internet market and 30% of the pay TV customers. It was just too obvious that the new bigger company would not likely produce better service and lower prices for anyone. Just as it was obvious that AT&T + T-Mobile – another deal killed by regulators – would not be good for consumers.
If we are not cynical, we can take this to mean that all the money and influence in the world doesn’t always get you what you want. If it did, TWC would have been absorbed by the end of 2015. There is still some balance in US politics, it is not completely for sale.
For cord cutters? The decision was good news. Netflix and the emerging streaming market were not going to benefit from a bigger Comcast.
There are certainly many mid and upper level managers at TWC breathing a temporary sigh of relief. But those that follow the industry know this is just a pause, and that news of a possible Charter-TWC merger is already breaking. For Charter to succeed they will have to do a better job convincing us all that there is any benefit to another merger.