Acquisition of Time Warner Cable by Charter Communications

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It is not unusual in today’s market conditions for two large companies to merge. This also happened to Time Warner Cable and Charter Communications, Charter engulfing the cable company Time Warner Cable. Should we, the users of the cable provided by Time Warner, be worried about the change? Well, it is less likely for Charter Communications to want to lose the customers gathered by the cable company in so many years, as it would be a very smart move. Probably the changes will happen gradually, in time, so what none of the customers to feel disturbed by the merge. But, we should all expect some changes to happen, and they will rather soon.

About the Acquisition

It is not a simple thing for a company to incorporate another one because this goes beyond just simply purchasing the entire business. It takes a while to put together all the conditions that will make the deal favorable for the two parties, plus the financial engineering and federal approvals that are also a part of the equation. So, overall, it took about a year for Charter to close the deal with Time Warner. Besides acquiring the cable company, Charter also got the Bright House Networks, the entire deal costing $67.1 billion. Due to this acquisition, Charter Communications just became the second largest cable operator in the nation, being the third place on the list of the most important MVPD in the country. Under these circumstances, this step was more than welcome for Charter, the company currently enjoying 17 million subscribers for video content and 19 million subscribers for broadband.

What’s New to Expect?

Now that Time Warner Cable does not exist anymore, everything will shortly bear the logo of Charter, things will change for sure. Still, the transition will happen smoothly and on an extended period. The new name of this merger will be Charter Spectrum, so this will be the first thing you will notice changing, together with the appearance of a new plan for pricing and packages offer. Charter is looking to provide many improved services to its customers, and this means to renew the old existing infrastructure that was previously used by Time Warner. All the cables and equipment that is out of standards today will be replaced, this operation lasting for a while.

More precisely, the process of modernizing what the old company used will be completed only in 2018. Also, do expect to get new in-the-cloud services provided by Charter, because the company has been working on such a service for a while. The positive feedback received from the areas where this service has been implemented encouraged the company to go further, so this will definitely be on their service offer. Last, but not least, Charter promised to end the practice of outsourcing, hiring new employees to do the requested work. About 20,000 people will be hired in the US, according to the plans of the company, which will definitely improve the quality of services for customers.

Consumer Point of View – Pros & Cons

Pros: The new Charter Company definitely wishes to keep the existing customers, including the ones acquired with the help of this merger; this means that it will strive to deliver services of superior quality. In fact, the company promises a better picture, superior customer service, faster Internet, and the availability of in-cloud services. If you are looking for such services, as a customer, then you are in luck, because you will soon receive the new service packages the company promised to deliver.

Cons: Just like anything else on today’s market, there has to be a downside, because no business is perfect. What could be the most inconvenient thing for a client? The answer will be the price, of course. The company did promise competitive prices for the array of services that will be available. But you should expect at least a slight increase in the costs. After all, improving the infrastructure, hiring more employees, and increasing the quality of the services are a considerable investment. No one says that this will cost a fortune, but it won’t come for free either.

Investor Point of View – Pros & Cons

Pros: If you are among the investors that purchased equity shares of TWC or Charter, before the merger of these two companies took place, you may win more than usual. This can happen if the plans of Charter will work in the end. The company wishes to come with much-improved services and a strategy to acquire even more clients. The intention of Charter on the market can mean more revenues for the investors. But there are always chances, even if only slight, for things not to work in the desired direction.

Cons: The only thing you may not agree with is a change in the rules of the game for investors. It is not known for sure how the company will deal with previous investors, since the main concern is to finish the planned rebranding, to modernize the infrastructure, finish the new service offer, and many more concerning the inside structure of the company and its customers. You’ll have to wait and see, hoping that there will be no bad news.

Conclusion

For the moment, everything seems to be just fine about this new merger. Everybody is excited and Charter seems to be doing a great effort not to disappoint its customers. Since Time Warner Cable was a rather old company, activating in this domain since the 60s, it was expected for a change to happen after so many decades. There are only positive reactions after the deal finally closed, everybody expecting to see what will come next.

But, all this excitement and promises will also come with high expectancies from the customers. So Charter should play its cards very well if the company does not want to disappointment. For now, there is nothing left for us than to hope that we will enjoy better entertainment experiences in the near future, as Charter is planning on offering.