Sunday, 26 February 2017

Conflicting reports of possible Verizon-Charter deal

By Nick Wood, Total Telecom
Friday 27 January 17

U.S. telco may or may not be exploring a possible tie-up with cableco.

Verizon may or may not be exploring a possible merger with cableco Charter, according to conflicting media reports this week. CNBC on Friday cited sources who claimed that no significant talks between the two companies are taking place…

Verizon may or may not be exploring a possible merger with cableco Charter, according to conflicting media reports this week.

CNBC on Friday cited sources who claimed that no significant talks between the two companies are taking place.

That came after the Wall Street Journal reported on Thursday, citing sources of its own, who claimed Verizon and Charter were holding preliminary deal talks.

For Verizon, a deal with Charter would give its media business a welcome boost, helping it to keep pace with closest rival AT&T, which, after its acquisition of DirecTV and its recent agreement to acquire Time Warner, is poised to pull ahead when it comes to converged services.

For Charter meanwhile, which consolidated its position in the cable market last year with the acquisitions of Time Warner Cable (TWC) and Bright House Networks, a deal with an MNO would give it some powerful new assets with which it could chase down Comcast, which plans to enter the mobile market this year with an MVNO service.

A tie-up between two industry heavyweights would obviously attract intense regulatory scrutiny.

It is generally expected that incoming Federal Communications Commission (FCC) chairman Ajit Pai will be more in favour of consolidation, but a merger between Verizon and Charter might still be considered a deal too far.

It could ultimately hinge on whether the new FCC waves through AT&T's proposed $85.4 billion Time Warner buy.

AT&T CEO Randall Stephenson revealed during the telco's quarterly investor call on Wednesday that he had met new U.S. president Donald Trump before his inauguration, and expressed confidence that the deal will be approved.

Verizon declined to comment on the reports.

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