The Charter-Time Warner Merger Would Create a New Internet Giant

Regulators are paving the way for a merger that could create a new Internet giant. The Federal Communications Commission and the Department of Justice are set to approve Charter’s proposed takeover of Time Warner Cable and Bright House Networks, so long as the newly formed company agrees not to impose data caps for seven years. FCC Chairman Tom Wheeler confirmed that he circulated an order recommending that the merger be approved.

In 2015, Comcast withdrew its $45 billion bid to acquire Time Warner Cable when it became clear that regulators were unlikely to approve the deal. Comcast is already the largest broadband provider in the country; the acquisition would only have made it larger and more powerful. Charter’s $78 billion bid, on the other hand, has always been seen as more likely to clear regulatory hurdles. In 2015, research firm Leichtman Research Group estimated that Charter would end up with 18 million subscribers if the merger were approved, placing it ahead of AT&T’s 16 million subscribers but behind Comcast’s 22 million. In other words, it would make Charter considerably more powerful in the market, but it would still have large rivals to keep it in check.