Following Comcast's decision to acquire Time Warner Cable, as a result, the CaTV battlefield in the US could get significantly smaller. The proposed deal would merge the two largest CaTV operators in the US – with the result of creating a very large entity with wide service footprint and around 33m pay-TV (video), 32m high-speed broadband (Internet) and 16m telephony (VoIP) subscribers.
As of 4Q13, according to InfoCom's monitoring of top-10 ranking (based on proportionate subscribers) of broadband, pay-TV and VoIP, Comcast secured the 3rd spot in broadband (i.e. total and retail segments) and VoIP, while it placed 4th in the Pay-TV ranking. The acquisition of Time Warner Cable would result in substantial additions in proportionate subscribers – around 11.6m in each of the total and retail broadband segments, nearly 11.4m in Pay-TV, and over 5m in VoIP.
However, in order to avoid monopolistic restrictions, Comcast might have to divest around 3m Time Warner Cable pay-TV subscribers to maintain its total market share at 30% of the US pay-TV industry. FCC might also ask to spin-off these subscribers as a separate entity, a fact that would de facto create another powerful player in the US cable TV market. Apparently, Liberty Media recently alluded to the fact that Charter Communications might be interested in these 3m pay-TV subscribers.
Once the deal gets the go signal, based on proportionate subscribers, (1) Comcast can overtake Telefonica and grab the 2nd spot in both total and retail broadband rankings. (2) Additionally, Comcast will closely follow The DirecTV Group in terms of Pay-TV subscribers, snatching the 2nd spot in front of MI&IT China and Liberty Global. (3) Lastly, Comcast will trail NTT slightly, and possibly dislodging Liberty Global for the 2nd spot in the VoIP segment. In case Charter acquires the 3m spin-off Time Warner Cable pay-TV subscribers, these net additions would still not be enough for Charter to enter the top-10 Pay-TV rankings worldwide.