Comcast Agrees to Buy TWC, Now What Comes Next?

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Feb. 13 (Bloomberg) -- Bloomberg News’ Alex Sherman, senior West Coast Correspondent Jon Erlichman, and chief Washington correspondent Peter Cook examine Comcast’s $45.2 billion deal for Time Warner Cable and what may come next for the cable industry on Bloomberg Television’s “Bloomberg West.”

We know that there has been reported a lot on this.

This enter from chart tore get bigger.

In a world where people have a lot of options outside traditional cable.

Facebook, any big platform where they can spend their time these days, the cable industry feels like it needs to get bigger so it can spread the cost around, the cost of making the service better and the technology that goes into that.

Charter had this great interest in doing this deal with time warner cable.

Time warner cable wanted them to pay more money.

They wering about the possibility of comcast acquiring some of the assets of time warner cable and along the lines they decided comcast, it's a better move to get bigger than everybody else and have control over marks like new york and los angeles and chicago, philadelphia, the d.c. area.

They truly are the biggest player in the cable business in the united states.

But is this deal going to go through?

The regulators made it clear with at&t and t-mobile they wanted four wireless carriers.

Is it going to be any different?

It is because they are different businesses.

The government is going to scrutinize this carefully.

You get number one and number two joining together, that raises a lot of flags.

Because there is that full sprecktrum of competition from the satellite providers and google and the things over the internet, a lot of folks i'm talking to say this is going to be looked at a little differently.

But they are going to ask a lot of comcast.

They are going to ask them to divest subscribers that would put them over the 30 million mark.

They are going to ask them to do a range of things with regard to net neutrality.

This is going to be a difficult process and it's not a done deal.

Comcast making the case in favor of this from the competitive standpoint but there are folks in washington who think this will be l get done although the conditions may be very painful for comcast.

I want you to take a listen to about this deal.

These companies have to get as big as possible as fast as possible nort keep their programming cost down, in order to create even more economies of scale and marketing back office systems, all of that stuff.

I want to bring you into this.

We've talked to apple talking to time warner cable about a new deal for apple tv.

What does this mean for invasion, does this slow that down?

There is argument it could speed it up because comcast technology is spoir to time warner cable.

You make them bigger and give them more resources and bigger scale, you can get more customers on the same page as far as expedited the way that people watch television.

Comcast has guide the "x" 1 and x 2 they are called.

They are state of the art individual crow guide.

They look like netflix or amazon prime than your cable grid you are used to.

You add on a lot more customers to that and it's possible that many more people can have a more advanced television viewing experience than they can today.

However, i want you to take a listen to another thing that jonathan kline had to say about how monopolies impact things.

They take audience for granted and that is an enormous opportunity for new comers to come in.

Time warner loves to say don't leave us we have this cool new apple thing coming down the road.

The problem is apple doesn't have content relationships.

What does this all mean for apple?

I found myself thinking today about walter isaacson's book on steve jobs and the comment where steve wasn't that big on paying for cable, decided i'm going to sign up for comcast.

And then after signing up, he called the c.e.o. of comcast and roberts said steve told me it sucks.

That's a reminder that comcast does have some cool technology and brian roberts does think about putting out a more innovate tive service.

But most of us view the cable companies as slow and trying to squeeze us for money and have been hoping there might be some new great type of tv watching experience that is more like the experience you have on your phone.

I think that's why a lot of people have been pointing to apple.

As bloomberg has reported in apple's talks with time warner cable, the challenge apple faces is breaking up that cable ecosystem, being able to sign competitively priced deals with all the content players that are similar to the ones that the cable companies already have.

You did an interview with disney c.e.o. bob iger.

Disney owns nbc, i want to talk about the content perspective.

First take a listen to what iger had to tell you in that interview.

Whether this consolidation or ownership of the existing multichannel business changes, we're going to be as in demand as we've been.

You can't go after the subscriber without offering them our product so it doesn't really mean much to us.

Given comcast also owns nbc, that adds another wrinkle into this whole potential deal.

How does that play into this?

It's a big factor.

They are not a straight cable player.

They are a content provider as well.

It's an important wrinkle and it's one of the factors that will make regulators look at this differently and why the stakes matter more than cable bar.

One thing very important to remember is the consent decree they signed with the government when they took on nbc, they agreed to do certain things in that deal, thoings pro mote more competition in terms of programming and expect they are going to have to follow that same roadmap in this deal.

They might have to exceed that to win regulators approval.

Does it become too painful so it becomes less attractive to them.

They have committed to do some of those things but not all of them.

What do you think, how does this actually all play out?

Had one important thing to look at is there is no breakup fee in this deal.

You could interpret that several ways.

That's confidence on both sides something can get done.

If regulators did step in and block this, neither side would be paying anything.

In a way it also blocks out charter.

Because i think charter would have seen the breakup fee and said ok if time warner cable has to pay comcast, maybe we can make a case to shareholders we're the better option.

Without the breakup fee it's going to be difficult for chart tore get in here.

They can't pay $160 a share.

They haven't up to this point.

It's better than a 50/50 chance at this point that comcast will proceed and divest some subscribers and move forward with the deal.

Comcast is already making their case.

They are speaking on a conference call right now.

This text has been automatically generated. It may not be 100% accurate.


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