(NEW YORK) — Comcast and Time Warner Cable announced Thursday that the two giants will merge to form a veritable cable behemoth with an even bigger reach in metropolitan areas along with providing substantial content since Comcast currently owns NBC Universal.
The $45 billion deal, which would involve Comcast purchasing Time Warner stock, would mean 34 million subscribers before any divestiture, dwarfing all of their competition.
What federal anti-trust regulators will scrutinize is whether the deal is in the public interest since the combined companies’ huge market share could scare off content creators and online video companies.
In addition, the new company would have greater sway with networks that need cable to carry its content.
To keep its market share under 30 percent, Comcast is planning to drop three million subscribers.
However, that might not be good enough for consumer groups, who already say that monthly cable bills are too high. If Comcast-Time Warner Cable essentially leaves competitors in the dust, prices could presumably skyrocket.
Copyright 2014 ABC News Radio
Nate Eaton, EastIdahoNews.com
Aaron Smith and Evan Perez, CNM