Time Warner Cable, the parent company of NY1, and Comcast announced Thursday the two companies have agreed to a merger that will create the nation's biggest cable provider. Diane King Hall filed the following report.
Two giant cable companies are about to become one.
Comcast inked a deal to buy Time Warner Cable, the parent company of NY1, in an all-stock transaction valued at roughly $45 billion.
The unexpected agreement was signed in the wee hours of Thursday morning, at about 1:30 a.m. to be exact.
But could merging the top two cable providers in the country cut the mustard with regulators?
"I think on the face of it you could say we didn't allow Direct TV-Dish to go through so why we should allow this to go through? But remember Direct TV and Dish were competitors and in the rural markets across this country that's almost people's only choice. There wasn't cable in the rural parts of this country,” said Sr. Media Analyst at Northland Securities Tom Eagan.
Speaking about the tie-up on a conference call with journalists, Brian Roberts, CEO of Comcast, said consumers can expect, "All-digital network with the fastest broadband, with the fastest in home Wi-Fi, with the most on-demand offerings and a suite of capabilities on tablets and smart phones that allow consumers to access that content whenever they want, wherever they want."
Under the terms of the deal, the company is offering to shed approximately three million subscribers to scale down competitive concerns.
The agreement, which amounts to approximately $158.82 a share, handily beats an earlier offer by Charter Communications, which proposed buying TWC for $132.50 a share.
But Time Warner Cable CEO Rob Marcus isn't gloating.
"What I feel great about today is not that we did a deal with Comcast and that we didn't do a deal with Charter. What I feel great about is that the customers end up winning, our shareholders end up winning, and everything else is just noise,” said Marcus.
For customers at home, what does it mean?
The deal is not expected to close until the end of the year so for now your bill won't change
One of the few stand-out differences is Comcast imposes data limits on its Internet service, while Time Warner Cable has unlimited broadband. It remains to be seen which of the two will win out.