Following rumors last night, Comcast has announced that it is acquiring Time Warner Cable in a multibillion-dollar deal.
The official press release claims that this is a merger, but in reality Comcast is ponying up a cool $45.2 billion to absorb 100 percent of TWC. In turn, Time Warner Cable shareholders will find that they own about 23 percent of Comcast's common stock. In other words, it's buying it out.
You can expect some huge monopoly concerns to arrive with this news. Comcast is trying to quell early criticism, though, suggesting that it's prepared to divest systems that supply roughly 3 million of the 11 million customers it takes on from TWC, and ensure that it never serves more than 30 percent of the US market. How well it will keep that promise remains to be seen.
In terms of customer service, Comcast claims that the operational cost savings of $1.5 billion which the merger will bring will allow it to provide "a superior video experience, higher broadband speeds, and the fastest in-home Wi-Fi" for consumers. Which is something, I guess.
It's worth noting that, while Comcast and TWC are happy with the terms of the deal, shareholders and US regulators still have to approve it—so it's not quite cut and dry just yet. If it does all fall into place for Comcast, though, your choice just got a whole lot slimmer. [Comcast]
Image: AP Photo / Gene J. Puskar