Comcast Still Sees Time Warner Cable Deal Closing as Planned

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What a Comcast-Time Warner Deal Would Mean for Dish

Comcast Corp. Chief Executive Officer Brian Roberts said he still expects the proposed takeover of Time Warner Cable Inc. will close early this year, addressing growing concerns about the prospects for regulatory approval.

Regulators have taken a tougher stance on how Comcast and other broadband providers manage their networks, raising questions about Comcast’s ability to complete a transaction that merges the two biggest cable companies in the U.S.

“We continue to believe this is an approvable transaction,” Roberts said on an earnings conference call Tuesday.

Comcast’s fourth-quarter results highlighted the growing importance of broadband in an industry in which more viewers watch programs on Web services like Netflix and Amazon and fewer buy cable-television packages. The number of Comcast’s high-speed Internet customers -- at almost 22 million -- is just shy of the number of cable-TV subscribers.

The shares gained 1.9 percent to $59.30 at 11:59 a.m. in New York. Through Monday, Comcast had risen about 5 percent since announcing the $45.2 billion plan to buy Time Warner Cable last February, underperforming the Standard & Poor’s 500 Index, which had increased 16 percent in the same period.

Net Neutrality

The Federal Communications Commission is set to vote Thursday on a proposal that would give the agency more authority to bar Internet-service providers from blocking or slowing Web traffic. Comcast has opposed the new so-called net-neutrality regulations, saying they would deter investment in broadband networks.

“This week they had been dealing on the open Internet order, as everyone knows, and hopefully they’ll be able to turn attention to our transaction right thereafter,” Roberts said.

When Comcast and Time Warner Cable proposed merging, most signs pointed to approval. Although investors grew increasingly skeptical, the new rules from the FCC could make the deal’s approval more likely. The push to guarantee everyone equal access to broadband may give regulators political cover to approve a deal while limiting Comcast’s broader power on the Internet. The proposed rules could alleviate concerns that Comcast will block or slow competing content providers’ access to the Internet.

Roberts was asked Tuesday whether to gain merger approval he would agree not to challenge the net-neutrality rules in court.

Comcast doesn’t want “to be different than any other company in the industry,” he responded. As part of the company’s 2011 purchase of NBCUniversal, Comcast agreed to follow FCC open-Internet rules until 2018. The company has been the only Internet service provider legally bound in that way since a court voided the agency’s previous net-neutrality regulations last year.

Broadband Customers

Fourth-quarter net income rose 0.6 percent to $1.93 billion, or 74 cents a share, from $1.91 billion, or 72 cents a share, a year earlier, Philadelphia-based Comcast said. Earnings were 77 cents a share excluding some items, trailing the 78-cent average of estimates compiled by Bloomberg. Revenue increased 4.8 percent to $17.7 billion, driven by increases in political advertising and business services.

The company is trying to add broadband customers as the number of people signing up for cable TV slows. Comcast signed up 375,000 new broadband customers in the quarter, and added 6,000 cable-TV subscribers, for a total of 22.4 million.

“Broadband remains their search engine,” Craig Moffett, an analyst with MoffettNathanson LLC who rates the stock neutral, wrote in a note.

Dividend Boost

Comcast also said it would increase its quarterly dividend by 11 percent to 25 cents a share. The company plans to repurchase $4.25 billion in shares this year and has authorized $10 billion in such buybacks.

Sales at Comcast’s NBCUniversal group, which includes the NBC broadcast network, cable channels such as USA and MSNBC and the Universal film studio, rose 2.3 percent to $6.62 billion.

NBCUniversal has increased the fees it charges pay-TV providers to carry its content in an effort to offset advertising declines caused by lower ratings.

NBC’s news division this month suspended anchor Brian Williams for six months after finding that he had exaggerated his account of a 2003 reporting assignment in Iraq. The controversy could hurt ratings and advertising revenue.


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