Charter Communications Acquisition of Time Warner Cable

It’s hardly a rare occurrence for two companies to merge and now that has happened with Charter Communications and Time Warner Cable. Charter has acquired and merged with Time Warner Cable. Does this mean that Time Warner customers should be worried though? No doubt Charter would like to keep all of the customers that Time Warner Cable has and so, if they were to make changes, they would do it slowly so that the merger doesn’t put off customers. Even so, changes are going to happen so it’s better to expect them.

How the Acquisition Came Together

One company incorporating another is a process that can take a long time. It’s not enough for one company to simply buy the entirety of the other. It can take time for everything to come together in a way that benefits all involved. There is also the issues of financial engineering and receiving federal approval. This is a deal that has taken around a year to fully come together. As well as picking up Time Warner Cable, Charter got their hands on Bright House Networks. All in all the merger cost Charter just over $67 billion. As a result of merging, Charter Communications has now become the second largest cable operator in the United States and is now the third most important MVPD in the States. So it’s no surprise to hear that Charter, a company with 17 million video content subscribers and 19 million broadband subscribers, readily welcomed the move.

What Should We Expect?

Time Warner Cable no longer exists so everything under the banner is bound to change. Even so it will be a change that happens over a long period of time. The new company that has been formed by the merger will be called Charter Spectrum, which tells you the first thing you’ll see change. It’s also expected that new plans, prices, and packages may emerge. Charter is hoping to improve the services that they provide to their customers and part of that is to renew the infrastructure that Time Warner Cable was using. Charter will be replacing all of the old cables and equipment that Time Warner Cable used and this is a process that could take a long time.

It’s expected that this modernization process could last until 2018. You should also expect to receive cloud services from Charter as they have been developing those for a while now. They have received a lot of positive feedback from the testing areas and have been spurred on to go ahead with their plans to implement such a service. Finally Charter has promised to put an end to outsourcing and hire new people to do the necessary work. It’s expected that Charter will hire around 20,000 people in the US which will definitely lead to an improved quality of service.

Pros and Cons for Customers

Pros

Charter is definitely interested in retaining Time Warner customers and their old customers too. As such they will do their best to deliver an incredible service to keep everyone on board. The company is actually promising to deliver a brighter future including excellent customer service, high speed internet, and the inclusion of cloud services. This is great news for customers who are interested in those kind of services.

Cons

There’s always a downside and the downside here is, of course, the price. It’s expected that prices for Charter Spectrum services may now go up a little. This is because it’s not cheap to improve infrastructure, hire employees, and make the services better quality. Those kind of things don’t come for free.

Pros and Cons for Investors

Pros

If you were smart enough to purchase shares in either company before the merger then you come out of it pretty well; as long as Charter delivers on their promises. The company is determined to improve their services and is putting together a strategy to increase their client base even further. Charter has very good intentions and this could mean more revenue for investors. Of course there’s always the possibility that things won’t work out as Charter wants them to.

Cons

Something that an investor could find themselves disagreeing with is a change in the rules for investors. Right now it’s not currently known how Charter will handle previous investors because they are focused on completing the rebranding, modernizing the infrastructure, and completing their new service offers, as well as other demanding issues based around the structure of the company and their customers. Right now investors have no choice but to watch and wait to see how things will unfold and hope it goes well.

Conclusion

Right now the merger looks absolutely fine. People are excited about the future and Charter seems to be doing everything they can to avoid disappointing their customers. Because Time Warner Cable was such an old company; having been in operation since the 60s, a change has been expected for a few decades now. Everyone is still positive following the deal and is just eagerly awaiting what comes next and how things move from here.

What comes along with all these promises and all this excitement is that customers will have some pretty high expectation. It’s important for Charter to be careful about how they move now so that they can avoid disappointing their customers. Right now you have nothing to fear and plenty to hope for; including the great entertainment experiences that Charter Communications is promising.