Anyone who still subscribes to the adage that nice people finish last hasn’t met Nomi Bergman. 

Bergman has been shining her light and leadership on a family legacy that’s seen her serve early executive stints at Advance/Newhouse (in publishing and cable) and Time Warner Cable; as president of Bright House Networks, the sixth-largest U.S. cable operator at the time of its 2016 merger with Charter Communications; and in her current role as an adviser on the evolution of the cable infrastructure she’s been championing since day one.

“The continued innovation of our infrastructure has enabled us to deliver products and services to our customers that we might not have dreamed of during earlier days,” she said.

Also: Welcome to the 30th Anniversary of the ‘B+C’ Hall of Fame

A self-described “rational optimist,” Bergman has “a lot of hope for the remarkable things a healthy team can create by working collaboratively together, staying close to customers, falling in love with our craft and aiming high.”

It’s a descriptor shared by Comcast chairman and CEO Brian Roberts, a decades-long ally and friend who counts Bergman as a Comcast board member.

“Nomi is a force in telecommunications — having been at the forefront of many trends in media and technology over the last several decades,” Roberts said. “She is unique for her knowledge, passion and unwavering optimism. It has been a privilege to have her great insights on our board, and we are lucky that Nomi’s leadership and vision are helping to shape our industry.”

That vision began in the early ’90s with Bergman joining her father Robert Miron in the cable business, initially consulting on back-end systems including the streamlining of disparate billing systems.  

In 1998, she was on the ground in Charlotte, North Carolina, for the launch of Road Runner, TWC’s initial cable-modem internet service. 

“It really felt like a historical moment,” said the mother of three daughters. “The fact that plants could be two-way … it was huge. People didn’t believe it, and they didn’t think they needed it because they thought dial-up was fine.”

Bergman ascended to perhaps her most notable career highlight to date — helming, along with her father and brother, Steve Miron, Bright House Networks and its 8,500 employees serving 2.2 million customers.

“The opportunity to build a multibillion-dollar brand, and to build leadership teams and cultivate a culture of care by authentically engaging and listening to employees and customers and learning how to best show up to serve them was just incredible,” she said. 

Steve Miron, also a 2022 Hall of Fame honoree, said it’s been a career highlight to work so closely with his sister: “She’s the most driven person I know; she’s got a great strategic head. She always knows what I’m thinking, and I always know what she’s thinking … and 90% of the time it’s the same thing.”

Among notable customer-first initiatives, Bergman launched a campaign called Just Say Yes, plastering signage in call centers and ensuring employees knew the company had their backs as they super-served customers. Then came the Friends Campaign, centered on the premise that Bright House would pull out all the stops to treat its customers like family and close friends, whether that meant bringing needed food to house calls or technicians working after hours to ensure a student could take an online test. “It was a magical time,” she said.

“Nomi has made a career out of ‘saying yes’ to customers, colleagues, and partners who need her,” said Peter Stern, a VP at Apple who worked with Bergman at Time Warner Cable from 2006 to 2014. “She has enriched countless people’s lives with her insight, integrity, and boundless generosity.”

Sharing Industry Pride

Throughout her career, Bergman has led with a genuine love for the industry, and for the people who make it run. “I look at the infrastructure our industry provided during the pandemic, and I feel such humility and pride,” she said. 

What’s on the mind of the avid adventure traveler these days? Regulation and opportunity. 

Aside from Comcast, Bergman is on boards of Black & Veatch, Visteon and her alma mater, the University of Rochester. She is also on the FCC’s Technological Advisory Council. For Advance, she’s a board member of 1010data and Hawkeye360, which enables the observation of RF signals from space.

 “I love the space industry,” Bergman said. “There are a lot of ties to the cable industry.” ■

“Fundamentally, the cable business is really an infrastructure business. We need to think about how to evolve our infrastructure so it’s flexible to not only offer and scale today’s products but be prepared to offer the products our customers will want tomorrow.” 

Steve Miron is discussing one of his favorite topics — the future of the industry he quite literally grew up with. After decades in the trenches — including at the helm of Bright House Networks alongside his sister (and fellow honoree) Nomi Bergman — as CEO of Advance/Newhouse, he now advises some of cable’s most senior executives, including those at Discovery and Charter Communications, on whose boards he sits. 

“I’ve had a unique opportunity to be involved on the distribution side and on the content side with a variety of companies, whether Time Warner Cable or Bright House or Charter and Discovery, and to watch the way those companies think,” he said. “It’s been really fascinating. It’s been a great journey.”

Also: Welcome to the 30th Anniversary of the ‘B+C’ Hall of Fame

Miron’s journey began back in high school, selling cable services door-to-door and via telemarketing. After college, he had stints at Newhouse cable properties MetroVision in Chicago, Vision Cable in Charlotte, North Carolina, and NewChannels in upstate New York. When the Newhouse family combined operations with Time Warner Cable in 1994-95, Miron stopped working directly for the family business and went to work for TWC for the better part of a decade. 

He stepped into the spotlight in 2003 with the launch of Bright House, in conjunction with TWC. “Steve Miron built the best service organization as CEO of Bright House, and it became a model for the industry,” Charter chairman and CEO Tom Rutledge said. “Today he continues to lead through his board positions at Charter and Discovery with the same great values he used as CEO.” 

Some of those values Miron is proud to say he gleaned from the family patriarch, Robert Miron. “I definitely learned from my father about being a good listener,” he said. “Listening is hugely important and underrated, and I still work at that all the time.”

In fact, the opportunity to work with his family was one of Miron’s favorite parts of the Bright House experience. “We were partnered with Time Warner Cable at the time but we had [free rein] of how we wanted to put Bright House together, how we wanted to organize it, even what we wanted to call it,” he said.

The feeling was mutual. “I have the deepest respect for my brother, and it’s a really wonderful feeling knowing he’ll always be here for me and I’ll always be here for him,” said Bergman. “And I also really enjoy my time with him. He makes me laugh so hard.”

The naming process was a journey unto itself, with the team landing on the Bright House moniker that made it stand out from the pack from day one. “It was definitely a little bit different for the industry,” Miron said. 

The team had rights to some of the legacy Newhouse brands but decided to take a different route. “We put together a group and a process, and we talked about what we wanted to be as a company. We wanted to be a customer-focused company, and we wanted to have a name that was customer-focused. Bright House emerged as the leading contender, and it was a name that was what we aspired to be,” Miron said.

Super-Serving the Customer

That customer focus enabled the company to super-serve subscribers and gave Bright House an edge in an increasingly competitive landscape. “We had one of the first Verizon Fios overbuilds in the country in our markets, in Texas and Florida, and we had a strong brand in those markets and we were a good competitor,” he said. “As time wore on and we saw more competition in video and broadband from overbuilders, having that customer focus was something that was important to our competitive stance.”

Former Cox Communications CEO Patrick Esser said Miron offers a unique mix of skills for a cable executive. “I appreciate Steve for his thoughtful leadership and ability to build strong industry relationships,” he said. “I’m very excited to see him recognized.”

As the industry keeps evolving, Miron looks to its roots to serve as a bellwether. “I have a real appreciation for just how wonderfully flexible our architecture is, how powerful it is, and how the business has been made with a great entrepreneurial spirit, and great engineering as well,” he said. “The industry has done a really nice job building and scaling flexible architecture to offer an amazing array of products that really changed people’s lives.” ￭

NBCUniversal said it is at an impasse in its carriage negotiations with Charter Spectrum and that the content company’s cable and broadcast networks will likely go dark when their respective agreements expire Dec. 31.

“NBCUniversal values its partnership with Charter Spectrum, our third largest distributor,” the Comcast-owned programmer said in a statement. “Charter Spectrum has been unyielding in its demand for terms superior to those agreed to by the rest of the industry, including larger distributors. Given this position, we feel the responsibility to inform viewers that Charter Spectrum may drop NBCUniversal’s networks at the end of the year, including NBC, Telemundo, USA, Bravo and hit shows including the #1 show on TV — Sunday Night Football, WWE, the Golden Globes, This is Us and more.”

Charter officials declined to comment, but noted any loss of signal in a dispute would have to be initiated by the programmer.

Charter is the second largest cable operator and the third largest pay TV provider in the country with about 17 million customers, trailing DirecTV and Comcast. The cable operator bulked up with more than $90 billion worth of acquisitions, closing its $80 billion purchase of Time Warner Cable and its $10.4 billion purchase of Bright House Networks in May.

The cable company tweaked the noses of some programmers earlier this year when it tried to impose Time Warner Cable’s rate card on its Charter systems. Some programmers objected, claiming those old, pricier deals with Charter weren’t set to expire until later, prompting some to file lawsuits. Charter, according to some of the suits, had tried to explain the shift by claiming it was acquired by TWC, not the other way around. 

NBCU has set up a informational web site for customers concerning the dispute at Delivermyshows.com, and has provided a toll-free number for customers at 1-844-55-Deliver (1-844-553-3548).

If the dispute goes long, Charter customers stand to miss sports programming like NFL Sunday Night Football, the NHL Centennial Classic and Premier League soccer on NBC as well as returning broadcast shows like Blindspot (Jan. 4); The Blacklist (Jan. 5); The 74th Golden Globe Awards (Jan. 8) and This is Us (Jan.10).

Nomi Bergman, president of Advance/Newhouse Partnership and the former president of Bright House Networks, has been elected to the board of Visteon Corp., a maker of cockpit electronics and connected car products under brands such as Lightscape, OpenAir and SmartCore.

Bergman’s board seat at Visteon becomes effective October 1. Bergman was alsorecently named to the board of Mediamorph, a cloud-based rights management systems for programmers and video distributors.

Those appointments followed Charter Communications’s acquisition of Bright House and Time Warner Cable in May.

“We are honored to welcome Nomi to our board of directors,” said Francis Scricco, chairman of Visteon’s board of directors, in a statement. “She adds a tremendous amount of industry leadership as proven by her role in leading the cable television industry into the software phase of its development.”

“I am honored to join the talented, dedicated members of the Visteon board and company, who have courageously led the firm through a significant transformation,” added Bergman. Both inspired confidence in me, as they have done with their customers. Visteon has clearly emerged with a strong balance sheet, a robust foundation of successful design and manufacturing experience, and a crisp, innovative focus on cockpit electronics and connected car solutions.”

Dr. Rouzbeh Yassini, a Visteon board member and DOCSIS pioneer known as the “Father of the Cable Modem,” said: “Visteon’s transformation to provide software platforms for the auto industry began in 2014, gained momentum with the 2015 hiring of Sachin [Lawande] as its CEO, and now adds more strength with the addition of Nomi to Visteon’s board with her solid technical and service- oriented leadership.”

Visteon posted Q2 sales of of $773 million and net income of $26 million, or $0.76 per diluted share.

Arthur Orduña, an executive and engineer well known in cable circles, has been appointed chief innovation officer of vehicle rental company Avis Budget Group, effective August 29.

In that new role, Orduña will be tasked with working across functions at the company “to deliver state-of-the-art solutions to keep pace with changing customer expectations and to drive sustained, profitable growth,” the company said.

Parsippany, N.J.-based Avis runs more than 11,000 rental locations in about 180 countries. It also runs Zipcar, a top car-sharing network that touts more than 1 million members.

Orduña will report to Avis Budget Group CEO Larry De Shon. “We see innovation as a key enabler for our future success.  Arthur’s role will be to foster a culture of innovation to strengthen our brands and drive our business forward,” De Shon said in a statement.

Orduña is joining Avis from home security and automation giant ADT Corp., where he also served as chief innovation officer.

Orduña, who also had a stint at PayPal, is the former chief product officer of Canoe Ventures, the MSO-backed advanced advertising J.V., and served as SVP, policy and product at Bright House Networks (now part of Charter Communications).

Liberty Global chairman John Malone is reportedly close to buying up a local cable operator in Poland in a deal that would consolidate the cable company’s holdings in that country.

According to Reuters, reports in Polish business newspaper Puls Biznesu said that Liberty is close to a deal with cable operator Multimedia and combining it with its UPC Polska operations,. The combined companies would cover half of the country with about 2.2 million subscribers.

UPC Polska is the largest cable operator in Poland. Any deal would have to be approved by regulatory  authorities. Terms of the deal weren’t disclosed but reports said the combined company would have annual revenue of about $574 million.

Liberty Global has been aggressive on the deal front – it completed a $7.4 billion buy of Caribbean telecom provider Cable & Wireless in May and has made a big splash in the European cable market in the past, snapping up Virgin Media in 2013 and partnering with Vodafone in February in a 50-50 joint venture to combine their Dutch operations in a deal valued at about $29 billion.

Malone was a big player in U.S. cable consolidation – his Liberty Broadband spinoff owns a 27% interest in Charter Communications and helped fund that cable company’s purchases of Time Warner Cable and Bright House Networks. After that landmark deal, the cable legend has apparently turned at least some of his attention to Europe, with reports saying he would be open to a deal with Vodafone, the continent’s largest wireless company. Talk of a Liberty-Vodafone deal has been common over the past several years – as early as 2014 the wireless conglomerate was reportedly considering a takeover -- but haven’t materialized, largely over valuation issues. That could still be the case although it hasn’t stopped the speculation.

On the domestic side, Malone also has been looking for a suitor for premium channel Starz, which was spun off from Liberty Media in 2013. In February 2015 Malone swapped a 4.5% stake in Starz for a 3.4% interest in movie studio Lionsgate, which fueled speculation that a combination was imminent. In February of this year, Lionsgate filed documents with the Securities and Exchange Commission noting it intended to start merger talks with Starz, but those discussions were cut off after Lionsgate stock fell hard on disappointing box office from the final installment in the Hunger Games franchise – Hunger Games: Mockingjay Part 2.

At the Gabelli Movies & Entertainment conference yesterday, Starz CEO Chris Albrecht echoed what he has said in the past, that more deals will happen in the space, whether it be between Viacom, Time Warner Inc., Starz or Lionsgate, but it all depends on the timing.

"Once something happens, there are going to more things that happen,” Albrecht said. “…I don't predict any particular occurrence, but I do predict that we will see more activity in the M&A space among the companies I mentioned and more, and young Dr. Malone will be somewhere, you can be sure," Albrecht said at the conference.  

Cable operators were literally the best and worst of telecommunications services providers yet again in a new customer-satisfaction survey.

The good news was that cable operators, who have pumped money, resources and personnel into improving customer service across the board, stopped their two-year slide in the pay TV portion of the survey. The bad news was they still finished last.

But the data also shows something about the mindset of the typical cable subscriber. The same customers that rate their cable provider among the worst for pay TV service see them as stellar broadband service providers.

Never mind that both services are traveling over the same network and use essentially the same customer-service personnel. It’s almost as if hating your cable company is a birthright. Broadband hasn’t been around long enough yet to foster that kind of hatred.

BROADBAND IS ESSENTIAL

Part of the reason also could be that customers perceive their broadband service as more important to their lives. Maybe this is further proof that customers are paying less attention to linear TV, and when they do, it’s because their tablets don’t work.

Another anomaly: Telco TV providers are at the top of the pay TV ranks yet have been losing customers over the past several quarters.

For the most part, cable’s performance in the American Customer Satisfaction Index — an annual survey of 12,710 customers on the often-touchy subject of customer satisfaction — has been consistent. For the past five years, cable operators have mostly received scores in the high 50s to low 60s.

Cox Communications usually got the highest rating. The big exception was last year, when despite fullyear gains in basic video subscribers at Time Warner Cable (53,000) and Charter (11,000), some operators, including TWC, turned in their worst showings ever.

Mediacom Communications has been battling a PR war after being singled out by some news outlets as “The Most Hated Company in America,” based on its ACSI showing. Mediacom’s scores of 54 in pay TV and 57 in Internet service providers was the lowest in all of the industries ACSI tracks, including cellular, wireless and wireline telephone. TWC (up 15.7%) and Comcast (up 14.8%) bounced back this year off declines.

Mediacom has countered that the sample size of its customers was small, which could skew the results, and has pointed out that it has boosted Internet speeds and introduced night and weekend service calls and 30-minute appointment windows.

MERGERS AREN’T HELPFUL

ACSI director of research Dr. Forrest Morgeson said in an interview that cable’s performance will likely decline this year and next as Charter moves to integrate TWC and Bright House.

“What we generally see is in the wake of mergers, for a year or two after, both of the companies involved tend to do a little bit worse,” Morgeson said. “It’s tough to say what will happen in this case, but it is fair to say that neither Charter nor Time Warner are stellar in terms of customer satisfaction. My guess is you’ll see a little bit of erosion as new customers come on to the Charter brand and there are problems with accounts and expensive plans and so forth.”

Charter has said it has been preparing for the integration of Bright House and TWC for about two years and plans to take a slow, steady approach to minimize disruptions. It has said it plans to hire 20,000 customer-facing employees over the years to help improve the customer experience.

Charter’s intentions sound good, Morgeson said, but there is always room for unforeseen circumstances.

“It’s not the things that you prepare for that go wrong,” he said.

As I read the news of the closing of the Charter Communications-Time Warner Cable transaction, I am sad, as a former TWC/ATC executive, to see the company disappear.

I worked for ATC and then Manhattan Cable in the 1980s. Under Trygve Myhren’s leadership (ATC’s CEO from 1975 to 1988), the company rationalized markets and realized that serving major DMAs was the way to go. But more importantly, Trygve and the team saw the future.

ATC pioneered advancing cable technology and capability: first video-on-demand, then pay-per-view, advertising sales (a tiny business), data services and retail. ATC also created one of the first national customer service/ retention departments, of which I was a proud manager.

Related:Charter’s New Road Map [subscription required] | Charter Sets Its New Technology Team [subscription required]

The company’s innovation continued as it became Time Warner Cable (merging with Warner Cable). TWC achieved great financial success and did bold experiments like the Full Service Network. Wow! What a concept — 500 channels. TWC took the leadership role in rolling out fiber networks and continued achieving meaningful adsales revenues, solidifying its position.

Today, as TWC winds down, Charter and Comcast are both at the forefront of delivering the most compelling customer offerings and services ever delivered by cable companies. They’ve become the innovators, creating meaningful business revenue above and beyond delivering programming — from advertising to content creation to serving businesses’ and consumers’ technology needs.

Related:Rob Marcus: Tuning Up TWC Before Handing Over the Keys [subscription required]

It will make a great case study to see Charter and Comcast evolve side by side, and to assess why both surpassed and survived the once much larger Time Warner Cable. I wish the entire Time Warner Cable team all the best.

R.I.P. Time Warner Cable and Bright House Networks (another storied company). Here’s hoping the Charter team, led by Tom Rutledge with his deep ATC/TWC roots, leads the company to new heights and pioneers the next chapter.

With its much-awaited purchase of Time Warner Cable and Bright House Networks in the books, Charter Communications now embarks on what is expected to be a years-long journey to put the pieces of all three companies together.

The deal, which closed May 18, put new Charter firmly in place as the second-largest U.S. cable operator and the nation’s third-largest multichannel video programming distributor (MVPD) — behind AT&T (owner of DirecTV) and Comcast. It now boasts 17.3 million video customers, 19.4 million high-speed Internet subscribers and 9.4 million telephone customers.

The new Charter has a lot of challenges ahead, and expectations are high. Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak has put a $285 per share 12-month price target on the stock, a 26% premium to its $225.58 close May 25.

RELATED:Rob Marcus: Tuning Up TWC Before Handing Over the Keys [subscription required] | Charter Sets Its New Technology Team [subscription required] | Goodbye, Time Warner Cable

With barely two weeks under its belt as a combined company, investors and cable watchers have a lot of questions about what lies ahead for the newly combined colossus.

What will Charter CEO Tom Rutledge do now?

Charter chairman and CEO Tom Rutledge knows Time Warner Cable’s markets. Prior to running Cablevision Systems for about 10 years as chief operating officer, he worked at Time Warner Cable for 24 years, starting at predecessor American Television and Communications (ATC) in 1977, and has been through several large integrations.

Still, mergers are rife with unexpected pitfalls: Frontier Communications ran into several issues after it transitioned former Verizon Fios systems in California to its network on April 1, including sporadic outages that, in some cases, lasted for weeks. Frontier has said it will give bill credits to customers affected by the problems. Back in 2006, Time Warner Cable weathered a difficult integration of former Adelphia Communications systems it acquired in Southern California.

The differences, most analysts believe, are time and quality. Time Warner Cable is in much better shape than it was even when Charter made its winning May 2015 offer

“Unlike the Frontier acquisition that has had all sorts of service issues, which we would have been vulnerable to in the last deal, we’re a little more comfortable with acquiring all the assets of both of these companies, intact and operating,” Rutledge said at the MoffettNathanson Media & Entertainment conference earlier this month. “We’ve had sufficient time to map all the relationships between the companies and create clear, accountable authority throughout the organization. We are able to execute the existing business plan as of now.”

Wlodarczak said he believes Rutledge will take the same approach with TWC and Bright House that he did with Charter when he joined the MSO in 2012 — a sharp focus on improving customer service and product offerings.

“Except Time Warner Cable is in much better condition than Charter was,” he said.

When Rutledge took over in 2012, Charter had 33.7% high-speed data penetration and 29.9% triple-play penetration; it had lost about 155,000 video customers over the year. By the end of 2015, broadband Internet and triple-play penetration had ticked up to 44.5% and 32.4%, respectively, and Charter reduced its residential video losses to just 2,000 customers. In the first quarter of this year, the company added 15,000 residential video subscribers.

With Time Warner Cable and Bright House, first on the agenda is to unify pricing and packaging across the companies, an effort that will be done slowly and deliberately to ensure customer disruption is at a minimum. Time Warner Cable and Bright House have different video and data packages than Charter — Charter’s minimum broadband speed is 60 Megabits per second, while Time Warner Cable has a 3-Mbps tier and Bright House offers speeds up to 25 Mbps in its lowest tier. Those services will eventually be brought up to Charter-level in the next 18 months to two years.

Rutledge also said Charter expects to pause Time Warner Cable’s all-digital rollout in some markets to replace some equipment. As is the practice with the rest of the industry, Time Warner Cable uses DTAs for secondary outlets in the home, while Charter installs set-top boxes in every outlet.

Said Rutledge: “We want to have all our call centers look at the same information, have the same training systems so that we can change the plumbing out underneath, but keep the education process, the sales process and the service process uniform. The goal is over the next two years to fully integrate the company.”

Taking it slow with the Charter Spectrum brand is a wise move, Telsey Advisory Group media analyst Tom Eagan said. “Usually in these types of mergers you want to fi x the underlying issues before you start changing the names on the trucks; if you do it before, all it does is reinforce a bad reputation.” he said.

Eagan said he expects Charter to focus initially on issues like customer service and subscriber churn. Rutledge has said Charter plans to hire 20,000 new employees over time, mostly in service and maintenance positions.

Will deal conditions slow progress?

The Federal Communications Commission has already imposed several conditions on the merger, including offering inexpensive high-speed Internet service to low-income customers and expanding its broadband network to 2 million additional homes, including 1 million homes outside of its footprint.

That last stipulation has caused a lot of agita among small, independent cable operators, who see that mandate as a threat to their existing broadband business. Rutledge has tried to alleviate their fears, claiming that Charter plans to overbuild telcos, not cable companies.

At both the MoffettNathanson conference and the Media and Entertainment Analysts of New York (MEANY) meeting during INTX in Boston earlier this month, Rutledge said Charter would focus on new construction for the overbuild, especially housing developments that have a telco but no cable company offering service.

“It is not a cable-overbuild provision,” Rutldge said at the MEANY meeting. “There’s a provision that allows us to buy cable companies to meet that provision — up to 250,000 of that 1 million [homes] can be purchased cable systems that don’t currently provide high-speed data and can be interconnected with our assets.”

While even that practice would still probably encroach on a cable operator’s territory (albeit an area where service hasn’t been extended yet), Charter spokesman Justin Venech said the idea is to be the least disruptive.

How will Charter handle new over-the-top competitors?

The FCC also requires that Charter not impede its over-the-top competitors, something Rutledge said Charter has been doing all along. He has often said OTT service providers like Netflix and Hulu help drive Charter’s highly profitable broadband business.

Charter has been somewhat of a cheerleader for subscription video-on-demand services and the operator has pledged not to throttle back such offerings on its broadband network, a stance that earned it a critical endorsement from Netflix in the early stages of the TWC deal’s approval process.

At the MoffettNathanson conference, Rutledge said he expects the number of OTT players to expand and said that, in addition to chewing up bandwidth, the proliferation could have another positive effect on cable providers. “Most people who buy Netflix buy cable or satellite; they see it as a premium service,” he said.

He also plans to make it easier for customers to access OTT services like Netflix, Hulu and Amazon by making their apps accessible through Charter set-tops.

Who’s in charge?

Charter’s core management team will remain intact — on the corporate side, chairman and CEO Rutledge, chief operating officer John Bickham and chief financial officer Chris Winfrey will remain in those roles.

Several at Charter will essentially maintain their current roles: executive vice president of field operations Tom Adams; EVP, engineering and information technology James Blackley; EVP and chief marketing officer Jonathan Hargis; EVP and president of media sales David Kline; EVP, customer operations Kathleen Mayo; and EVP, business planning James Nuzzo.

New hires include Phil Meeks, formerly head of Time Warner Cable’s business-services unit, as president of business services; former PepsiCo executive Paul Marchand as EVP of human resources; and David Kline, a former Cablevision executive who joined Charter as EVP and president, media sales, in October.

On the TWC side, several top executives are expected to or already have left the company, including chairman and CEO Rob Marcus; chief operating officer Dinni Jain, EVP; chief product, people and strategy officer Peter Stern; EVP and COO media services Joan Gillman; EVP and chief video and content officer Melinda Witmer; EVP and COO, residential services John Keib.

Of the PR staff , EVP and chief communications officer Ellen East; group VP, corporate communications Anthony Surratt; and VP of public relations Bobby Amirshahi were expected to depart by June 2, but nearly half of the Time Warner Cable PR staff is planning to stay, including Maureen Huff and Rich Ruggiero. Charter also hired TWC’s David Gray as group VP of field marketing and TWC diversity and inclusion director Rahman Khan to oversee social-responsibility communications.

The bulk of TWC departures will be of executives at the EVP level or higher, as is typical in such mergers. People familiar with the situation said that Charter has handled the transition well and has been generous with departing personnel.

The top echelon of TWC executives were already set to receive healthy separation packages — Marcus headed the list with a $92 million payout, followed by Jain with a $35.3 million package, general counsel and secretary Marc Lawrence-Apfelbaum at $19.8 million and Stern at $16.9 million. Former chief financial officer Artie Minson took a $5 million payout in June 2015 and is now president and chief operating officer of online office-space provider WeWork.

Time Warner Cable went through a major restructuring in 2013, carving itself into three distinct business units and, according to people familiar with the matter, all of Charter’s business units have made their structures known to employees, with the exception of programming, sports and legal.

Multichannel News has reported that Rutledge has brought in former MSG Media president Michael Bair to oversee its local and regional channels: Time Warner Cable’s 17 news networks and three regional sports networks (Time Warner Cable SportsNet, Time Warner Cable Deportes and SportsNet LA) plus Bright House news channels in Tampa Bay and Orlando, Fla., and Bright House Sports Network.

Bair would inherit the mission of expanding carriage for SportsNet LA, the home of the Los Angeles Dodgers, beyond Charter, TWC and BHN — all part of the same company now. Other distributors in the market have resisted the channel because of its high price of about $4.90 per subscriber per month, according to SNL Kagan estimates.

On the programming side, Charter senior vice president of programming Allan Singer will continue to head up those eff orts. Always known as a tough negotiator, Singer will have added leverage in future negotiations with Charter’s newfound scale.

Charter and Rutledge have been outspoken critics of programmers who make their services directly available to OTT providers yet try to extract higher rates from MVPDs. Rutledge has argued that programmers that do so dilute the value of their content. “It will be interesting to see how they approach their first retrans and affiliate renewal,” Eagan said.

Is Charter still hungry to buy more cable systems?

Rutledge has said repeatedly that Charter will digest the TWC and Bright House deals before trying to increase its scale, and the federal government, which frowned on Comcast’s attempt to purchase Time Warner Cable because of broadband scale issues, could look unfavorably on a bigger Charter.

But that doesn’t mean that the Stamford, Conn.-based operator couldn’t buy smaller systems — part of its FCC conditions allow for the purchase of up to 250,000 cable customers in non-served or underserved broadband areas. That could mean smaller MSOs with systems close to the new Charter, such as Mediacom Communications, could be on the radar in the not too distant future.

While swaps with other operators are a possibility — Charter had planned to swap systems with Comcast when that company was going to buy TWC — Rutledge said that is an unlikely scenario.

“As beautiful as swaps are, and as efficient as they would be from a service perspective, they are very difficult to execute and getting more so every day,” Rutledge said at the MEANY meeting. “I’m not expecting it would be easy to negotiate a swap that everyone would want to go do.”

Wlodarczak said he expects Charter to focus on organic growth for the time being, but it could use its substantial cash flow, minus capex outlays — estimated to be about $6.1 billion in the first year — for deals. “I also think there is a good chance they will play the role of industry leader at their size in regards to such things as working with other cable companies to create a national SMB [small and medium-sized business] brand, perhaps working with Comcast to make a joint bid for T-Mobile,” he said.

What’s Charter’s approach to wireless?

As part of the deal, Charter inherits a mobile virtual network operator (MVNO) agreement with wireless powerhouse Verizon Communications from both Time Warner Cable and Bright House. The MVNO agreement results from the 2012 sale of wireless licenses to Verizon by SpectrumCo, the cable-industry consortium that also included Cox Communications and Comcast. Comcast already said it has activated its MVNO rights, but has been quiet as to its intentions. Rutledge said recently that Charter is aware of its wireless rights, and is investigating its options.

But Rutledge, like other pay TV executives, is well aware of the potential power of wireless offerings after his successful experience building out Cablevision’s WiFi network.

“When we look at WiFi and inside-out strategies using less expensive private spectrum or small cell service, our network is particularly laid out well to take advantage of that,” Rutledge said. “I’m still a big believer in that inside-out strategy, both in the business and the residential marketplace.”

Charter Communications chairman and CEO Tom Rutledge set some cable hearts back on their regular beats Thursday, claiming that the third largest MVPD in the country has no intention of overbuilding cable operators as part of the conditions of its just-completed merger with Time Warner Cable and Bright House Networks, but instead will focus on telco broadband providers.

Among the conditions imposed by the Federal Communications Commission regarding its purchases of TWC and Bright House, Charter agreed to overbuild 2 million homes over a period of five years in markets outside its footprint.

The American Cable Association, representing smaller cable providers, had objected to that requirement, saying it potentially put small cable companies at risk of being "drive(n) out of the market" by the more economically powerful Charter. 

At the MoffettNathanson Media & Communications Summit, though, Rutledge said the plan is to focus on telephone companies in its overbuilding strategy, not cable companies.

“When I talked to the FCC, I said I can’t overbuild another cable company, because then I could never buy it, because you always block those,” Rutledge said at the MoffettNathanson event. “It’s really about overbuilding telephone companies.”

Rutledge also told analysts the same in briefings at the INTX show in Boston earlier this week.

Rutledge said the conditions require that Charter build 2 million new passings over a period of five years, with 1 million of those passings against another high-speed Internet provider.

“If someone builds a housing development with 20,000 homes in it, there is a phone company in there, usually it’s AT&T, or Frontier in some markets,” Rutledge said. “Usually that plant is in the ground in the same trenches as yours, so you’re in a competitive environment.”

He added that the conditions also allow Charter to purchase up to 250,000 cable customers in the area that aren’t interconnected, which would be further incentive not to overbuild a cable system.

Asked by interviewer MoffettNathanson principal and senior analyst Craig Moffett that if other cable operators who had expressed concern over that particular provision may have misread the condition, Rutledge said overbuilding a cable operator would be business suicide.

“Why would we go where we could get killed,” Rutledge said.

Rutledge also provided some insight into the operator’s integration plans for TWC and Bright House, adding that Charter plans to hire an additional 20,000 people over the next few years. That is in addition to the workers being absorbed through Time Warner Cable and Bright House, something the Charter CEO has said in the past.  Time Warner Cable had about 55,000 employees when the Charter merger was announced in May 2015 and Charter had about 24,000 employees at the end of that same year. Rutledge added that it should take about two years to fully integrate the companies.  

In a decision that could have far-reaching implications for the nation’s Internet-service providers, the Federal Communications Commission imposed a condition on Charter Communications’s acquisition of Time Warner Cable and Bright House Networks that will bar the post-merger Charter from imposing data caps and usage-based pricing policies for a period of seven years.

That condition, alongside others that prevent New Charter from charging interconnection fees and entering programming deals that could harm online video distributors, clearly are in place to keep the MSO from erecting barriers that could tamp down OTT competition.

The FCC so far has not moved to pursue rules that would fit similar collars on other ISPs, but chairman Tom Wheeler has tasked the commission with investigating the impact of data caps, usage-based policies and zero-rated offerings that exempt some services from an ISP’s or mobile carrier’s usage policies.

CAUSE FOR WORRY

That posture is cause for concern for ISPs that have implemented or are testing usage-based policies that are being built into their business models. While ISPs that use such policies preach that it’s about fairness — those who use the most bandwidth pay more than those who don’t — critics see them as a tool to keep over-the-top video competitors in check.

Industry analysts offer various opinions as to how the Charter conditions will affect ISPs that currently use data caps and usage based pricing. And it’s still too early to tell if those conditions will put much pressure on other ISPs to voluntarily toss out their capping and usage-based data policies, at least in the near-term, Jeff Wlodarczak, CEO and senior media and communications analyst of Pivotal Research Group, said.

Wlodarczak also doesn’t believe the lack of a usage-based pricing option will have much of an effect on the MSO’s current business strategy, which is focused on driving revenue generating units (and revenue) without being super-aggressive on price.

It’s also possible that Charter could try to compensate in other ways, such as driving customers to higher-end, more expensive tiers of service. Charter’s entry-level speed — 60 Megabits per second downstream — is already faster than the lower-end services marketed by many of its MSO peers.

Though it’s not clear if the FCC’s condition on Charter will affect other ISPs directly, some have recently tweaked their policies and begun to offer new unlimited data options that are OTT-friendly (see sidebar, below).

MoffettNathanson principal and senior analyst Craig Moffett said that the Charter conditions and recent data policy changes implemented by ISPs do change the game, because they effectively take usage-based pricing off the table as pay TV operators continue to face off against rising OTT competition.

‘CALM BEFORE THE STORM’

“It’s hard not to see this as simply the calm before the storm,” Moffett noted earlier this month in a semi-regular “Cord-Cutting Monitor” report, citing Hulu’s coming multichannel service, new OTT options from DirecTV and Amazon, and a virtual pay TV service called “Unplugged” that YouTube reportedly has in development.

“If and when the rains come, cable operators won’t have the umbrella of usage-based pricing,” he wrote. “We’ve always described UBP as an insurance policy, not to forestall OTT video but simply to make cable operators economically indifferent to it.”

On that note, Moffett has long considered usage-based pricing as a mechanism for MSOs to preserve a “transport charge” for video.

“With Charter committing to no UBP for seven years, and with Comcast … raising usage caps from 300 GB to an all-but-irrelevant 1 TB per month, UBP is now essentially off the table,” Moffett said. “That doesn’t make cord-cutting any more likely. But it does leave cable more vulnerable.”

Some ISPs that have implemented caps and usage-based pricing clearly are troubled by the FCC’s condition on the Charter-TWC deal and the potential threat it might pose to their future policies.

“Charter’s concessions related to usage-based pricing and data caps are certainly concerning,” Thomas Larsen, Mediacom Communications’ group vice president of legal and public affairs, said in a statement soon after the FCC’s proposed conditions were circulated. “Promoting a model in which the vast majority of a company’s broadband subscribers subsidize the behavior of a small group of heavy bandwidth users seems to go against the fundamental principles of American commerce.”

When the FCC was still considering the order that was eventually issued that bans Charter from using caps and usage-based broadband pricing for seven years, AT&T said it was “apparent that some or all of the conditions will have a broad effect beyond the parties to the merger.”

SIDEBAR: Fitting Customers With Different Data Caps

U.S. ISPs, both big and small, have been gravitating to unlimited data plans and soft caps that charge extra when monthly limits are exceeded. Here’s a snapshot of policies that have been deployed or are in the pilot phase:

Comcast: Starting June 1, Comcast will move to a monthly 1-Terabyte data plan in its current group of test markets, including Atlanta; Tucson, Ariz.; Chattanooga, Tenn.; and Charleston, S.C. Customers who exceed that ceiling can buy an additional 50 GB of data for $10, or move to a new unlimited data plan that costs $50 more per month.

AT&T: In March, the telco introduced an unlimited data plan for its U-verse and GigaPower residential broadband service that costs an extra $30 per month for customers who take a standalone data service, but, as an incentive, drops that charge for customers who bundle Internet with U-verse video or DirecTV service and pay on a single bill. Customers without unlimited data plans must pay $10 for an additional 50 GB when they exceed their monthly limit.

Mediacom: Also sells additional data buckets of 50 Gigabytes for $10 each when customers exceed their monthly limit, which scales up and down depending on the speed of the customer’s data tier. Mediacom has set a high monthly allowance of 6 Terabytes for its new 1-Gbps residential broadband service.

Suddenlink: The Altice-owned operator launched an unlimited data plan that is available to customers who take its two fastest tiers in a given market. Subs not on Suddenlink’s unlimited plans may pay $10 for an additional 50 GB when they exceed the limit.

BendBroadband: The operator, now owned by TDS Telecom, has set different monthly data limits based on the speed of the customer’s data subscription, and charges $10 per month for an additional 50 GB when customers exceed their limit. On May 9, BendBroadband began to exempt customers from those policies if they bundled Internet service with pay TV. BendBroadband estimates that more than half of its Internet customers are now longer subject to its datausage policy.

GCI: The Alaska-based operator’s “No Worries” data policy sets monthly data caps that scale up and down depending on speed, with the option to buy an additional 30 GB of data for $10 each when subscribers exceed that; upgrade to a different plan with a higher monthly limit; or get moved to a “basic level of service” (less than 1 Mbps) with no overages.

SOURCE :Multichannel News research

Sports analyst/correspondent Mary Carillo will host the 2016 Women in Cable & Telecommunications (WICT) Signature Luncheon in conjunction with NCTA's INTX Convention in Boston May 16.

That is the luncheon where WICT honors its 2015 PAR Best Companies for Women in Cable.

This year's PAR honorees in the operator category are Cox Communications, Comcast, Time Warner Cable, Bright House networks and Atlantic Broadband. Programmers are Discovery, Disney, NBCU, Turner and HSN.

Carillo is a correspondent for NBC Sports and NBC's Olympics team, as well as HBO's Real Sports With Bryant Gumbel and The Tennis Channel.

WASHINGTON — Federal Communications Commission chairman Tom Wheeler and the Department of Justice on May 6 green-lighted one of the largest broadband mergers in history, but not without exacting strict over-the-top programming access and buildout-related conditions.

Why did the proposed meld between Charter Communications, Time Warner Cable, and Bright House Networks — a deal that was close to being done a month before — stretch on? The delay had to do with getting those conditions lined up, and the three big ones — data caps, interconnection and over-the-top access to programming — will last for seven years. (The full FCC still had yet to vote on the merger at press time.)

Comcast also had to agree to seven-year conditions in its 2011 deal in which it wrested control of content giant NBCUniversal from General Electric, so there is precedent for the lengthy time frame, but Charter was hoping for three years.

New Charter, which will have 17.3 million video customers, 19.5 million high-speed Internet subscribers and 9.5 million voice customers when the dust settles on the $78.7 billion deal — will not be able to employ usage- based pricing or the broadband data caps now being tested by others.

RELATED:Cable Strong: Charter, TWC Power Through Q1 | Now the Hard Part: Integration

The post-merger MSO will keep the Charter name (sans Communications) and pass about 48 million homes; operate in nine of the top 25 DMAs, including the two largest, New York and Los Angeles; and have a combined 24 million customer relationships.

Charter had already pointed out that usage-based pricing and caps are not part of its current business model — but now that choice will be an enforceable deal condition for seven years. The company has a chance after five years to petition the FCC to remove that and the other seven-year hitches.

But given that Wheeler labeled those business plans “unfair barriers to video competition” in announcing the merger conditions, the rest of the industry may not have those options for long, either, though Wheeler signaled the conditions were deal-specific.

One former top FCC official said that, to him, it sounded like regulating by deal condition. “How are you going to allow these other data cap deals if you are going to say they are unfair?” he asked.

And no matter what the U.S. District Court of Appeals for the D.C. Circuit does with the FCC’s Open Internet rules — a decision on that challenge could come down at any time — New Charter, which would be the nation’s second-largest broadband provider and third-largest MVPD, will have to abide by all of them, including the general-conduct standard that allows the FCC to look at a range of prospective practices.

That was another promise Charter had already made as it tried to win favor with government regulators.

But while the deal could hamstring Charter vis-a-vis the competition in some areas, it allows the company to scale up like other industry players, such as AT&T, which merged with satellite-TV provider DirecTV last year, and Comcast-NBCUniversal.

Clearly, Charter saw those conditions as the price of getting that scale under an FCC and Justice Department that were focused on broadband — and that were being lobbied by some groups to block the deal entirely.

“Look, whatever they are, they are terms and conditions the company has agreed to as part of its exchange of value in an effort to get the merger approved,” National Cable & Telecommunications Association president Michael Powell said of the proposal.

Powell added that he had “a longstanding criticism of the way merger approvals are done and whether they are truly efforts to prevent competitive harm or efforts to regulate substantially more than jurisdictional authority allows,” but said he would wait to see the details.

One former top FCC official called the two MSOs the perfect pair. “Time Warner Cable desperately wanted to get out of the business, and Charter had to get this merger through in order to compete,” the official said.

Ultimately, Wheeler apparently saw the opportunity to put broadband-related conditions on the No. 2 broadband provider in the country as worth the pushback he would get from those who think any further industry consolidation is too much.

He said last week his vote to approve was based on imposing conditions “that will ensure a competitive video marketplace [with an emphasis on over-the-top video] and increased broadband deployment.”

Another former FCC official speaking not for attribution said the deal definitely hurt Charter competitively.

“Looking at all the things the deal is doing, it looks a lot like industrial planning, as opposed to otherwise,” the official said.

The source took issue with the FCC saying, in the context of a transaction, that it didn’t like usage-based billing or interconnection “because [it] wants to favor OVDs.” The official said that didn’t make sense when Netflix had 40% of the Web traffic, adding: “[Wheeler] has developed some very 1990s solutions to some 1980s problems.”

Piling on the broadband conditions, even if Charter committed to many of them voluntarily, appeared to work in terms of assuaging critics, given their relatively muted tone last week.

Deal opponents generally praised the many conditions, suggesting they helped take some of the sting out of another big merger, though Free Press president Craig Aaron said Wheeler had tarnished his legacy by approving the deal.

The Justice Department had filed suit against the merger on antitrust grounds, saying that, without conditions, the combined company would have “a greater ability and incentive to secure restrictions on programmers that limit or foreclose OVD access to important content.” Then, it filed a settlement in federal court with the repairs that would make the deal OK, which is Justice’s standard procedure in approving a deal with conditions.

Wheeler circulated a conditioned approval proposal to the other commissioners. They had yet to vote on it at press time, but the chairman would not have circulated it without the votes to approve it, albeit likely with one or both agency Republicans citing their unhappiness with the number of conditions either in partial dissents or statements.

Commissioner Michael O’Rielly had already suggested the deal looked like an effort to regulate via deal condition, something Republican commissioners have complained about before.

The DOJ and Wheeler announced their conditional approval on the same day, and both signaled through those conditions that the broadband side of the deal was key.

The FCC conditions — in addition to disallowing usage-based billing or data caps, and requiring adherence to net-neutrality rules — included mandatory high-speed broadband buildouts to 2 million more customers and a ban on interconnection fees, including to any online video providers like Netflix (another practice Wheeler branded an unfair barrier to video competition).

The DOJ also levied a seven-year condition that Charter cannot strike or enforce a contract that limits a programmer’s ability to offer that programming to an OTT competitor.

There is also a low-income, low-cost broadband initiative required for at least four years. Again, Charter had already pledged such an effort, so that is not a heavy lift.

Charter won’t be able to close the deal until at least May 12, when the California Public Utilities Commission is expected to vote on approving the merger. An administrative law judge has already recommended the deal be approved, with statespecific conditions. It is the last state approval hurdle for the deal to clear.

CHART: New Charter By the Numbers (Customers in millions)

Video                Charter     TWC       BHN       New Charter

Residential . . . . . . 4.2 . . . . . 10.8 . . . . 2.0 . . . . . . . 17

Business . . . . . . . . .0.1 . . . . . .0.2. . . . . 0.0 . . . . . . . 0.3

Total video . . . . . . 4.3 . . . . . . 11 . . . . . 2.0 . . . . . . . 17.3

Broadband

Residential . . . . . . 4.8 . . . . . .11.7. . . . . .1.9 . . . . . . . 18.4

Commercial . . . . . 0.3 . . . . . .0.6. . . . . 0.2 . . . . . . . .1.1

Total broadband . . .5.1 . . . . . 12.3 . . . . 2.1 . . . . . . . 19.5

Voice

Residential . . . . . . 2.4 . . . . . .5.3 . . . . . 1.2 . . . . . . . 8.9

Business . . . . . . . . 0.2 . . . . . .0.3. . . . . .0.1 . . . . . . . 0.6

Total voice . . . . . . 2.6 . . . . . .5.6. . . . . .1.3 . . . . . . . 9.5

SOURCE: Charter Communications FCC filing

"Abandon all hope ye who enter here" is written above the gates of hell in Dante's Inferno.  And for many broadcasters, MVPDs, and telcos, it might as well be inscribed above the Federal Communications CommissionM's Portals.  In The Divine Comedy, there are nine circles of suffering for unrepentant souls -- limbo, lust, gluttony, greed, anger, heresy, violence, fraud and treachery.  Here in Washington, there are just as many layers of suffering.  For any company seeking regulatory redemption, merger review can be a painful and protracted purge. Just ask Comcast.

The FCC has all but approved Charter Communications' $56 billion merger with Time Warner Cable (TWC) and Bright House Networks, which will make it the nation's second largest cable company behind Comcast.  This is no small feat.  We all remember that it was Charter's initial bid to buy TWC in 2014 that spawned Comcast's move on TWC for $45 billion.  That deal failed when Comcast abandoned the effort in the face of well-organized opposition.

Thus, Charter should be applauded for its adroit ambulation through the Portals to close a very big deal.  So why did it succeed? 

There are a few reasons, but none more telling than that it was willing and able to make a deal with the devil. In other words, Charter did anything and everything necessary to keep its merger intact, including co-opting critics, kowtowing to threats, and making promises that will be hard to keep. But then again, facing a $2 billion breakup penalty can bring urgency and creativity to even the stodgiest companies.

Nevertheless, Charter came to the table prepared to create new jobs and a special low income, high-speed, broadband offering.  It took on net neutrality commitments it did not have to, and it promised to invest millions in communities and save as much for consumers.  With such good intentions, Charter was unprepared for the ambush by public interest purveyors issuing demands in exchange for support.  Having never faced such a stare down, Charter blinked and the opposition was nullified. Sealed in memoranda of understanding (MOU) are Charter's commitments to philanthropy, endowments, special programs and perennial support for a familiar cabal.  In similar vein, small, independent cable companies seized the moment to renegotiate their carriage deals or else they, too, would cry foul.  Charter made changes to the contracts; the critics became the chorus, and sang its praises to Congress and the Commission.

Through it all, Charter learned a few things it did not know before.  For example, the playbook for derailing a communications merger is well established by now, and goes something like this: Oppose the deal in broad public statements.  File antagonistic comments at the FCC.  Question the competitive and public interest benefits. Solicit statements from Congress.  Enlist support from so-called leadership organizations for a price. Conspire with a compliant FCC official. Castigate the company in the media and challenge its corporate practices.  Promote the delay or defeat of the transaction. Negotiate for concessions and conditions.  Extract as much pain and profit as possible.  Deposit the ransom checks. Wait for the next target.  Refine and repeat.  It is nice if the public interest is advanced, but it is not necessary.

Encountering one obstacle after another, Charter made whatever concessions necessary to get to the next level.  It survived a body blow from Dish Network and the Stop Mega Cable Coalition, which succeeded in derailing Comcast. It beefed up its rural chops with a deal to carry more country-western programming, and gained plaudits from the Hill.  And it cut deals for new Hispanic, African American and Asian program offerings system-wide. 

The FCC expects Charter to make network improvements to give consumers options in other markets.  It wants the company to abolish onerous contract provisions that restrict content producers from alternative distribution methods (ADM), including over-the-top (OTT).  It also wants Charter to change the way it handles the most favored nation (MFN) clauses in its contracts with programmers.  But not so fast.

In a deft display of legerdemain, Charter agreed to these terms provided they would apply to every company, industry-wide.  And since the FCC does not admit to regulation through mergers, it hastily adopted a Notice of Inquiry (NOI) on Diverse and Independent Programming as a quid pro quo to deliver on that promise.  Cynicism aside, the NOI establishes a solid predicate for a long overdue rulemaking in this area and could lead to progress.  Separate and apart from the merger, Charter will need to deal with the $10 billion racial discrimination suit filed by TV mogul Byron Allen, who will not go quietly into the night.

Assuming the California Public Utilities Commission approves the transaction -- which it should -- the Charter-Time Warner Cable deal will be done. But after the bonus checks and stock warrants have cleared, only time will tell if the promises made by Charter executives to secure approval will be delivered or even enforced. At the end of this saga, Charter deserves considerable credit for surviving a nearly two-year slog through the Portals Inferno.  The company surely has been chastened and will end up in a better place than it started.  And that just might be all the hope any of us should expect from the process.

 © 2016. Adonis Hoffman is Chairman of Business in the Public Interest and adjunct professor in Communication, Culture & Technology at Georgetown University.  He served at the FCC from 2013 - 2015, and is the author of Doing Good: the New Rules of Corporate Responsibility, Conscience and Character.

Charter Communications’s $78.7 billion merger with Time Warner Cable was expected from the onset to sail through the Federal Communications Commission approval process — unlike an earlier deal between Comcast and TWC that was abandoned because of regulatory concerns.

Lately, though, the combination of the second-largest cable operator (TWC) and the third (Charter) has drawn concern from state and federal officials who see the pairing as a means to concentrate power in the broadband industry. If the deal is approved, the new Charter would have 18.2 million high-speed Internet subscribers. Coupled with Comcast’s 23.3 million customers, the two would control nearly two-thirds of all U.S. broadband homes with available speeds of 25 Mbps or higher.

After a flurry of correspondence between the FCC and Democratic congressional leaders citing concerns about the deal’s impact, a Feb. 29 letter from Senate Minority Leader Harry Reid (D-Nevada) to chairman Tom Wheeler was its biggest threat yet. In a sternly worded letter expressing concern that new Charter would create a broadband duopoly the agency should look at closely, he ended the missive with this: “A competitive broadband marketplace is the only circumstance that will drive this outcome and until such a marketplace exists, further consolidation may pose a significant risk to consumers.”

None of the legislators are calling for an outright rejection of the deal, and most of the concerns are from veteran critics of consolidation who wouldn’t be expected to immediately bless any combination of broadband players. But Reid’s letter casts a shadow on the approval process.

“This will be a difficult letter for the FCC and DOJ to ignore and at the very least is likely to lead to a meaningful slowdown in the approval process, which appeared to be moving along rapidly toward closing,” BTIG media analyst Rich Greenfield said in a blog post.

The FCC is working toward a late March decision on the deal. Other analysts are puzzled that legislators are risking maintaining the status quo by rejecting it. No deal means no deal conditions, Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said. And no conditions means no incentive to change.

Charter has already shown a willingness to compromise, and possible conditions being discussed center around various contractual relationships — like most favored nation clauses — and even a broadband overbuild condition that would require the new company to deploy high-speed Internet in markets where it does not now offer the service but a competitor does.

“The government has a chance to get something material from the TWC-Charter deal approval and I don’t believe they are dumb enough to blow it,” Wlodarczak said.

Still, in the increasingly unstable political environment of 2016, a deal implosion would irrevocably alter the industry in five distinct ways:

1. Comcast gets stronger, or is broken up: With its status as the No. 1 cable and broadband provider, and Nos. 2-3 not really allowed to get any bigger, Comcast would be the de facto — and permanent — king of the cable hill. The cable giant already had its best growth year in about a decade after abandoning TWC by focusing on organic growth. Comcast could use its programming clout to go over the top outside its footprint or use its broadband dominance to eliminate the competition inside its service territories.

By rejecting the combination of two companies that would be smaller than Comcast, is the government saying the No. 1 cable operator is too large? While most analysts believe it’s a long shot, political sentiment seems to be shifting away from a few dominant providers to several smaller ones that would nurture OTT development.

2. Charter gets weaker: With the government basically preventing them from gaining meaningful scale, Charter will have to focus on what it had originally planned before it set its sights on TWC — growing organically, although at a slower pace. And it will have to do that after paying TWC its $2 billion deal-breakup fee.

3. Time Warner Cable could emerge stronger: With its second major deal blocked by regulators, TWC could be in a prime position, flush with $2 billion in cash which could be used for operations or to fund share buybacks, and riding strong momentum from positive performance in the past four quarters.

4. John Malone must rethink his strategy: With Charter no longer hunting big M&A game, Malone will have to decide if U.S. M&A is worth pursuing with Charter or another operator, whether to focus his efforts on the international markets with Liberty Global (a possible Charter partner) or if he should just play wait and see.

5. The cable deal market disappears: The consolidation movement fueled by Charter grinds to a halt as the three largest cable operators won’t be allowed to get any bigger. Altice Group, which bought Suddenlink Communications and is in the process of acquiring Cablevision Systems, could make a play for TWC, but would face similar regulatory problems — it will be about the same size as Charter.

SIDEBAR: Broadband Domination

Legislators are getting increasingly concerned with the balance of power in the 70 million-customer U.S. broadband market, fearing that a combined Charter and Time Warner Cable would concentrate nearly two-thirds of broadband subscribers in two companies — new Charter and Comcast. (All numbers are as of the end of Q4.)

CompanyBroadbandCustomers

Charter . . . . . . . . . . . . . . . . . . . . . . . . . . .  5.5 million

Time Warner Cable . . . . . . . . . . . . . . . . . .  12.7 million

Comcast . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.3 million

Total. . . . . . . . . . . . . . . . . . . . . . . . . . .  . . . 41.5 million

SOURCE: Individual companies

Last year, Comcast’s attempt to merge with Time Warner Cable collapsed after the Federal Communications Commission rightly concluded, “The merger doesn’t help consumers.”

Now, the FCC and the Department of Justice must once again ask whether consumers would benefit from a proposed merger of three giant cable operators: Charter Communications, Time Warner Cable and Bright House Networks.

The clear, simple answer is no! The continued, rapid consolidation of the communications and entertainment business is not in the interest of consumers or content creators.

If allowed to merge, this Mega-Cable monolith of a conglomerate would control more than a third of America’s cable television and broadband markets, including New York; Los Angeles; Dallas-Ft. Worth; and Charlotte and Raleigh-Durham, N.C. The merged companies, plus Comcast, would constitute a dangerous duopoly controlling almost 90% of all high-speed broadband connections in the country. That would put these giants in position to control the fate of new and emerging over-the-top services that rely on a robust high-speed broadband connection.

Worse yet, the thought that this merger is only a one-dimensional “distribution” play seems to us to be an unfinished sentence. Charter Communications and Liberty Media are very tightly linked with Discovery Communications, which owns 13 cable networks in the United States alone. Mega-Cable would have clear incentives to exercise its leverage in favor of Discovery content.

The content that consumers crave is carried over a single digital pipeline, whether it comes in the form of cable TV signals, OTT services, or online viewing. Content creators — especially independent storytellers and programmers — rely on competition among these entities to give them the opportunity to pitch and sell their work in as many places as possible. This ensures they are able to fetch a fair price and creates a diverse range of programs that inform and entertain audiences.

This is what competition is supposed to be about: a robust marketplace offering the greatest number of options to creators and consumers alike. The Mega Cable merger would significantly reduce competition. We urge the FCC and the Department of Justice to reject it.

The Writers Guild of America, East, AFL-CIO, represents thousands of members who create shows and craft compelling stories. Our work is enhanced when there are multiple opportunities to obtain distribution, funding and direct access to audiences. We, and the audiences with whom we share our work, are diminished by the increased power of the proposed Charter merger with Time Warner Cable and Bright House Networks.

Lowell Peterson is executive director and Michael Winship is president of the Writers Guild of America, East.

Scripps and Time Warner Cable have quietly struck a multiyear retransmission-consent agreement for stations representing more than 3 million households in 14 markets, a source familiar with the deal said.

The agreement also covers some Bright House Networkscable systems for which TWC handles retrans negotiations.

The affected markets are Bakersfield, Calif[ Cleveland; Cincinnati; Denver; Detroit; Milwaukee and Green Bay, Wisc.; Indianapolis; Kansas City; Nashville, Tenn.; Omaha, Neb.; San Diego; and Tampa, Fla.

The agreement comes as Charter Commuications and Time Warner Cable are trying to secure regulatory approval of their proposed merger.

Charter Communications CEO Tom Rutledge said his company is prepared to take over the operations of Time Warner Cable and  Bright House Networks, adding that it continues to wind through the regulatory approval process with hopes for a closing date early next year.

"We’re ready,"Rutledge said at the UBS Media & Communications conference in New York. "We've talked to Time Warer Cable and Bright House employees, we've set up a field stucture, a new regional structure and told people how that is going to work. We're ready to close at any time whe we're given permission and be ready to start operating the business."

Charter agreed to purchase TWC and Bright House in May. After the deals are consummated, Charter will grow from a 4-million subscriber cable operator into a 17-million subscriber powerhouse with operations major markets like New York and Los Angeles.

Last week Dish chairman Charlie Ergen came out against the deals in a filing with the Federal Communications Commission, claiming the combination would stifle online video development. 

Rutledge didn’t address Ergen directly but said at the conference that the Charter deals don’t have the same issues as Comcast-TWC did earlier in the year. Comcast withdrew its purchase of TWC in April after it determined the FCC would not approve the deal, mainly because of its broadband dominance.

Since the Charter deal was announced, TWC has had some of its best performance in years. In the third quarter, TWC shed just 7,000 video customers, its lowest Q3 loss in nine years. 

At the UBS conference, Rutledge acknowledged the TWC gains, but said he would probably do it differently.

“They’ve done a nice job in continuing long-term value,” Rutledge said. “Not exactly the way we would do it [though].”

Rutledge said the main difference is that Charter believes in placing two-way interactive boxes in every home, and TWC has been putting one-way digital boxes in some homes as it moves to take it network all- digital.

“We believe the future of TV is 2-way interactive,” Rutledge said.

 The Charter chief also addressed concerns that federal regulators may have problems with Liberty Media chairman John Malone owning a substantial stake in Charter. There has been a question as to if Malone would favor Charter with deals for content providers in which Liberty or Malone owns stakes.

Rutledge said favoring Charter would make little sense for Liberty. And he added that his 27% interest in Charter will be diluted to about 18% in the company once the deals are closed.

“He [Malone] is not in a control position,” Rutledge said. “There is no issue there.”  

Bright House Networks will boost residential broadband speeds for no added cost in early December.

Bytier, all marketed under the Lightning brand, here are the changes on the way: 

- 35 Mbps down by 2 Mbps up rises to 50x5;

-75x5  jumps to 100x10;

-150x10 moves to 200x15;  

-300x15 will increase the upstream side of the speed ledger to 20 Mbps.

“The speed boosts come at no additional charge to existing customers who already subscribe to these packages,” said the MSO, which has also deployed 52,000 WiFi hotspots, which factor into the 400,000 that are part of the Cable WiFi roaming consortium that also includes Comcast, Time Warner Cable, Cablevision Systems and Cox Communications.

Bright House Networks, which is merging with Charter Communications, said it will also launch its Lightning 300 service in additional service areas, and introduce a new highi-speed Internet package to customers, including a 25x3 tier,  in January 2016.

Cable’s WiFi-cellular prospects got a shot in the arm last week with news that the largest U.S. cable operator is making moves that could lead to a hybrid WiFi-cellular phone and data product.

Comcast wouldn’t say what, when or even if a wireless product would come to life, but it’s putting together the pieces. The first step was to exercise a MVNO (mobile virtual network operator) option with Verizon Communications, and Comcast is planning to begin evaluating a potential offering in about six months.

“We believe that wireless obviously is an important area for consumers,” Comcast chairman and CEO Brian Roberts said during the company’s third-quarter earnings call. “We are going to trial some things, we are going to test some things after we activate and we’ll update people as that progresses. But it’s an opportunity to take the network and the successful investments that we’ve made, and try and see if we can continue relationships and product innovation that the team is working on.”

One of those successful investments was SpectrumCo, a consortium that also included Time Warner Cable and Bright House Networks and which sold wireless licenses to Verizon for $3.6 billion in 2012. The MVNO rights spring from that sale.

CHARTER, TWC ON DECK

Comcast might not be alone in its wireless aspirations, MoffettNathanson principal and senior analyst Craig Moffett said. Charter Communications, which is in the process of purchasing both Time Warner Cable and Bright House, believes the MVNO rights are transferable and has expressed a desire to at least entertain the idea of a quad-play service.

Charter and Comcast could partner on a service, Moffett said in a note to investors, and jointly bid for broadcast spectrum. That would make economic sense but would likely draw an unfavorable reaction from regulators.

A WiFi-first phone and data product — one that uses the cable company’s WiFi network and hands off to the traditional cellular network to round out coverage — could be the answer to the elusive quad play of video, voice, data and wireless.

In the past, cable operators have tried their hand at offering a wireless product, through failed partnerships with Sprint and Clearwire. But this time may be different. The popularity of cable WiFi products, the low cost of the spectrum and the growth of mobile video could make a WiFi-first offering a success.

Adding to the urgency are recent moves by cable’s telco competitors. AT&T, which completed its $48.5 billion merger with DirecTV in July, has pushed heavy discounts for wireless and video service. Verizon, which already has about 5 million subscribers to its wireline FiOS TV product, also launched a free, ad-supported mobile-only video service — go90 — to limited audiences.

Cable companies have spent years building their WiFi networks. Cablevision Systems, which in September agreed to be acquired by European telco Altice, was the first, committing about $300 million to a WiFi buildout.

Other operators were later to the game but have stepped up efforts in past years.

But WiFi remains mainly a broadband retention tool except in the case of Cablevision, which launched Freewheel, a $9.95 per month WiFi-only phone and data service, in February.

Pivotal Research Group CEO and senior media & communications analyst Jeff Wlodarczak said a wireless play makes sense for cable operators that have already ramped up their WiFi offerings. “Why not offer consumers a low-end add-on wireless service that defaults to the WiFi network initially and then uses an MVNO to fill in the blanks?” he asked.

With about 80% of wireless data usage occurring in the home or office — two areas where cable is uniquely positioned — there is a high potential to offer a low-cost wireless service, as cable did with wireline phone service.

SPECTRUM AUCTION NEXT?

Moffett said he believes Comcast’s MVNO decision is the first in a series of dominoes to fall. The next could be its participation in the upcoming 2016 broadcast-TV spectrum auctions.

Bidding on and winning the lower-frequency broadcast licenses would allow Comcast to offer a service that would use WiFi in more populated areas and low-frequency spectrum in less dense locations.

On the earnings call, Roberts said Comcast hasn’t decided if it will bid on spectrum, saying it doesn’t feel the need for “owner’s economics” in a wireless offering. (Comcast-owned NBCUniversal expects to participate in the auction as a seller, Roberts also said.)

Whatever Comcast decides to do, they will be just the first steps in “what is likely to be a rather long and slow evolution,” Moffett said.

NUMBERS: Hot to Trot

Cable companies have been beefing up their WiFi networks, substantially increasing the number of hotspots available to their customers.

Company               No. of Hotspots
Comcast . . . . . . . . . . .11.7 million *
Cablevision . . . . . . . . . 1.1 million *
Time Warner Cable. . . . 400,000 +
Charter . . . . . . . . . . . . . . . N/A

* Includes indoor, outdoor locations in hotspot numbers
+ Per Cable WiFi Consortium, which includes Comcast, TWC, Bright House Networks, Cox and Cablevision

SOURCE: Individual companies, published reports

New Orleans — More than any single force shaping the television and broadband industry, technology is driving the biggest change.

Engineers and executives steeped in hardware and software acronyms, domestic and international, picked apart the biggest challenges faced by the industry, spanning mobile, multi-gigabit broadband, the IP video transition and a host of others, at the Society of Cable Telecommunications Engineers Cable-Tec Expo in New Orleans last week.

Waxing Wireless

While U.S. cable operators are leaning heavily on WiFi to lead their wireless strategies, Liberty Global has also been pushing hard on quad-play offerings that tie in the MVNO (mobile virtual network operator) model.

Mobile “is becoming the primary computing device,” Balan Nair, the MSO’s executive vice president and chief technology officer, said during a presentation about technology trends and how the operator is handling new forms of competition.

Liberty Global now has about 4.5 million mobile subscribers through its MVNO relationships (that subscriber number is expected to grow to 8 million through the MSO’s M&A activity). Nair said Long Term Evolution (LTE) allows for seamless connectivity, and the technology is on the road to delivering gigabit capacities.

“LTE is here to stay,” Nair said.

But WiFi “is becoming a bigger and bigger part of our story going forward,” he said, noting that delivering a good WiFi experience in the home matters more to many consumers than the wired broadband pipe connecting the home itself.

Nair also shed some light on Liberty Global’s future plans, telling the crowd the MSO is working on its first “WiFi-first” device, which would prefer WiFi access when it’s available and seamlessly fall back to the LTE mobile network when it’s not.

Enabling that seamless transition “is not an easy thing to do,” Nair allowed, adding that Liberty Global expects to introduce the WiFi-first product toward the fourth quarter of 2016.

During the follow-up panel moderated by Cox Communications president Pat Esser, Nair outlined four ways cable operators can enter the mobile game — they can build and operate the network themselves (if they have spectrum); buy another mobile provider; launch a “lite” MVNO whereby the MSO is relegated as a reseller; or introduce a “full” MVNO play where the operator builds out the mobile “core,” keeps call control and essentially rents access to the radios and base stations.

Liberty Global has tried out all four, and Nair was direct about the issues cable operators face with the home-grown route.

“I’ll tell you, building sucks,” he said. Though Liberty Global was able to obtain spectrum relatively cheaply, the MSO shut down its home-grown network about 18 months after launching it.

He said Liberty Global has found the most success, from an operational and economic standpoint, with the full MVNO approach, which allows the operator to control the SIM card that goes in the smartphone.

“In the end, it’s about handsets and price,” he said, noting that he puts the lite MVNO on the “bottom of the list” because the operator has no control — it’s just about renting and selling.

Nair also talked up the positive effect quad-play bundles have on customer retention.

“Over time, the churn rate is discernable between a quad-play and a non quad-play,” he said. “There’s a downside, though. If you screw up with mobile, you lose all four — you lose the whole quad-play.”

Service Agility, IP Video, Cybersecurity

The technology chiefs jumped to other topics during Wednesday’s conversation, including service agility, customer-centricity, the all-IP progression and cybersecurity.

Comcast, fresh off the national rollout of its voice remote, will launch an add-on called “X1 Answers” in mid-November, MSO executive vice president and CTO Tony Werner said.

“You’ll be able to ask, ‘What was the Broncos score?’ ‘How tall is the Empire State Building?’ I think it’s going to change a lot of things,” he said.

The transition to all-IP is foundational to proactive change, Werner and others said. By this time next year, Comcast will have deployed 8 million pure- IP set-tops, which matters to serving video on second screens.

“We have the same number of baby boomers as millennials right now, and the millennials are watching a lot more content on mobile,” Werner said. “If we have 24 million customer relationships and 15 million video starts in a week [on mobile devices] — that’s exponential, and it will probably only continue to grow. If you don’t have video over IP, you’re going to miss a big part of the audience — and it’s a growing part, not a shrinking part.”

Rolling out more features and services more quickly is a big priority for all network operators, execs said.

Liberty Global, which is deploying only Reference Design Kit-based devices and will begin converting to HEVC (High-Efficiency Video Codec) for 4K/Ultra HD video next year, will get to service agility using defined and publishable APIs (Application Program Interfaces), Nair said.

“I just want to build a stack that has almost every functionality covered by APIs — it’s a big transition for us,” Nair said.

For Nomi Bergman, president of Bright House Networks, the near-term product future includes more 10-Gigabit EPON (Ethernet Passive Optical Network), with an eye toward 100-G EPON. “We’re now helping to create the standard for that,” she said.” Also hot in BHN markets: Its “Echo”-branded whole-home WiFi solution.

“It represents a really nice collaboration between the technology, product and marketing teams,” she said.

On the heels of Tuesday’s Cybersecurity Symposium, Nair described a massive hack in the Netherlands, where 2 million broadband connections were shut down, two nights in a row. The four perpetrators were arrested a couple of weeks ago, and the incident caused Liberty to overhaul its crisis handling mechanisms.

“In dealing with communications, law enforcement, regulatory, PR — as it turned out, what we had wasn’t the most easily translatable during a crisis. We had to rebuild a lot of our processes,” Nair said.

Panelists were also asked to discuss some things they’re working on today. Phil McKinney, president and CEO of CableLabs, said his thinking tends to gravitate to what’s coming tomorrow, noting that his group has been focused on “exponential technologies” — things that are outside the scope of the traditional planning cycle.

He said he worries about “what’s beyond the horizon … so that we don’t get surprised.”

Read more news from SCTE Cable-Tec Expo.

Ahead of the fall TV season, Bright House is broadening its DVR platform with a new whole-home system called “Voyager” that can record six shows at once.

The MSO said the offering combined the recording capabilities of its “Enhanced” DVR with a whole-home system that can connect to seven additional cable boxes in the house. Subs can manage the DVR remotely via the BHTV app for iOS and  Android devices.

Pricing on the Voyager whole-home option and its suppliers were not immediately available (it does look similar to this Samsung-made model). According to a web page dedicated to the product, its Enhanced DVR allows users to store up to 150 hours of HD video. Time Warner Cable markets a similar six-tuner/1 Terabyte “enhanced” DVR made by Arris (the DCX 3600)  that it’s rolling out as part of its TWC Maxx upgrades.

Bright House, which serves 2.5 million subs in parts of Florida, Alabama, Indiana, Michigan and  California, is in the process of being acquired by Charter Communications. Charter, which is also trying to buy Time Warner Cable, is expected to extend its Worldbox/Spectrum Guide product strategy to the acquired properties.

T-Mobile and Bright House Networks are teaming on a Passpoint-powered WiFi roaming trial that will tie in about 34,000 hotspots that the cable operator has deployed in Tampa and Orlando, according to T-Mobile Web pages that detail the effort.

Those documents, spotted by Fierce Wireless, note that about 50,000 customers will receive a text message asking them to opt into the trial. The test will use Passpoint on handsets to auto-connect to Bright House’s WiFi network, and only on Passpoint-enabled devices that support either WiFi Calling 1.0 or 2.0. Voice-over-LTE support isn’t required but is “strongly recommended for the best experience.” VoLTE is encouraged because it “will improve your experience by enabling call handovers between Wi-Fi and VoLTE network when on the move,” explains the trial FAQ.

Update: This is an upcoming technology trial and not a commercial relationship between T-Mobile and Bright House Networks. "Yes, we are looking to conduct a technology trial in the Tampa-Orlando, Florida market focused on Passpoint technology and access," a T-Mobile spokesperson said, in a statement. "We continue to look at ways to drive a better, more differentiated wireless experience for T-Mobile customers." 

Passpoint, also known as HotSpot 2.0, is a technology that brings cellular-like handoff and roaming capabilities to WiFi, and is sometimes viewed as enabler for MSO voice-over-WiFi services. T-Mobile is using Passpoint on some WiFi-capable handsets so its customers can connect calls, receive messages and obtain data via the carrier’s “Preferred” WiFi access points. Data used over WiFi does not count toward a T-Mobile user’s monthly data consumption bucket, the carrier said. 

When WiFi is turned on, T-Mobile explains, the Passpoint feature in the handset and Bright House’s WiFi hotpot will automatically connect customers when they are in range. “No password is required.” Passpoint-enabled devices eligible for the trial include several iPhone models, the HTC Desire, LG G5, Samsung Galaxy S5, and Sony Xperia Z3, among several others.

Time Warner Cable is using Passpoint to help underpin its roaming pact with Boingo.

Word of the T-Mobile-Bright House trial comes as cable operators expand the reach of their WiFi networks and as some consider WiFi-first mobile services that prefer WiFi connectivity and use cellular as a backup. The Cable WiFi Alliance (BHN, Cablevision, Comcast, Cox Communications, and TWC are currently members) have deployed more than 400,000 quasi-public WiFi hotspots that are accessible to their respective high-speed Internet subscribers.  Of that group, Cablevision has launched a WiFi-only service called Freewheel.

Charter Communications, which is in the process of acquiring TWC and Bright House, has begun to deploy WiFi, under the “Spectrum WiFi” banner, and is expected to join the Cable WiFi group later this year.

Speaking Wednesday (August 5) on Charter’s second quarter earnings call, company president and CEO Tom Rutledge was asked about T-Mobile’s openness to potential cable partnerships and his interest in working with a wireless carrier.

“I think wireless is a component of our service already,” Rutledge said, referring to Charter’s WiFi rollout. “So I think there are opportunities, business opportunities, to create mobility for us whether that's with T-Mo or any other provider for that matter. I think opportunities exist there and people are trying to figure out the right business models to do that.”

Second-quarter revenue rose 7.6% and cash flow increased a strong 6.8% at Charter Communications, but basic-video customer losses rose slightly to 33,000 from 29,000 in the prior year.

Charter, which is moving forward in its $78.7 billion purchase of Time Warner Cable -- expected to close by the end of the year -- reported revenue of $2.4 billion and cash flow of $848 million for the period.

While basic-video losses were up slightly in the quarter -- the company said if bulk digital upgrades are excluded, basic-video losses fell to 28,000 from 44,000 in the prior year --  Charter managed to add 70,000 high-speed data customers -- up from 55,000 in the prior year. Phone additions of 33,000 were about even with the 35,000 added in Q2 2014.

Residential customer relationships grew by 34,000, with triple-play sell-installs improving year-over-year to 65% of total residential video sales. Residential PSUs increased by 70,000 versus a gain of 55,000 in the prior-year period.

"Our second quarter results demonstrate that our consistent focus on delivering superior products at highly-competitive prices, continues to drive our strong customer, revenue and cash flow growth," Charter CEO Tom Rutledge said in a statement.  "We look forward to applying that same focus and strategy across New Charter, following the close of our transactions with Time Warner Cable and Bright House Networks. Our new company will drive significant investment into broadband infrastructure, delivering faster broadband speeds and better video products to our customers, while driving customer and cash flow growth for our shareholders."

Charter Communications moved a step closer to completing its purchase of Time Warner Cable and Bright House Networks, announcing it will issue debt in a six-part deal aimed at partially financing the transactions.

According to Charter,  its subsidiary CCO Safari LLC will issue senior notes due in 2020, 2022, 2025, 2035, 2045 and 2055. Charter said in a statement that proceeds from the offering will be placed in escrow at CCP Safari II LLC until the closing of the TWC transaction, at which time the notes will be assumed by other Charter subsidiaries – Charter Communications Operating LLC and Charter Communications Operating Capital Corp.

Goldman, Sachs & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Credit Suisse Securities (USA) LLC, Deutsche Bank Securities Inc. and UBS Securities LLC will act as the joint book-running managers for the offering.

Charter said in May that it had agreed to purchase Time Warner Cable in a deal valued at $78.7 billion and in a separate transaction would acquire Bright House for $10.4 billion.

According to reports, the six-part bond deal could be worth between $12 billion and $15 billion when it prices later in the day. The offering is part of an overall $31 billion M&A funding package that will also include high-yield bonds and bank debt.   

The deals still need to receive regulatory approval before they can officially close. On July 8, the Federal Communications Commission picked the team that will vet the merger for the agency.    

Charter has filed its application with the Federal Communications Commission to buy Time Warner Cable.

The application includes a public interest statement with promises to go beyond the FCC's new Open Internet rules by agreeing to a legally enforceable condition that the combined company, which it dubs "New Charter," will not impose data caps or usage-based billing, neither of which it currently engages in, Charter noted.

The FCC on June 23 opened an official docket for comments on the deal, saying it was expecting the application to be filed.

Among the key benefits Charter told the FCC the deal will produce are faster speeds, affordable (and unlimited) broadband, faster rollouts of new technology, nondiscirminatory interconnection and more investment in customer care.

Among its commitments are a $2.5 billion investment in commercial broadband and returning call center jobs to the U.S.

Charter is volunteering the following specific, legally enforceable commitments, according to a summary of the public interest statement filed with the FCC:

• "New Charter will continue to commit to a free and open Internet. New Charter will not block or slow down Internet traffic or engage in paid prioritization — the same commitment already followed by Charter today.

• "New Charter will continue to engage in reasonable and non-discriminatory interconnection and submit any interconnection disputes to the FCC for resolutions on a case-by-case basis.

• "New Charter will continue to create thousands of U.S.-based jobs by hiring for customer service call centers and field technician operations located throughout the country and returning TWC call center jobs to the U.S.

• "New Charter will make comprehensive and significant investments in its broadband network. The company will transition TWC and [Bright House Networks] cable systems to all-digital networks, enabling consumers to take advantage of at least 60 Mbps download speeds and enjoy more high-definition and video-on-demand options.

• "New Charter will broaden access to broadband by building upon BHN’s broadband program for low-income consumers. New Charter will enrich BHN’s program by raising speeds and expanding eligibility while still offering a discounted price, and will expand the program across the New Charter footprint.

• "New Charter will recognize the vital importance of promoting diversity and inclusion strongly rooted in the communities it serves. New Charter will expand TWC’s commitment to diversity and inclusion in governance, employment practices, procurement and community partnerships.

• "New Charter will invest significantly in both in-home and out-of-home WiFi. New Charter will increase competition in the mobile data market by deploying over 300,000 out-of-home WiFi access points.

• "New Charter will build out one million line extensions of our networks into residential areas within our footprint beyond where we currently operate. These new facilities will help provide high-speed service to rural and other underserved areas; and

• "New Charter will invest at least $2.5 billion in the build-out of networks into commercial areas within our footprint beyond where we currently operate. This will create additional, much-needed competition in the commercial sector."

The FCC's Media Bureau has opened a docket (15-149) on the proposed merger of Charter and Time Warner Cable (valued at $78.7 billion), and the associated acquisition of Bright House by Charter ($10.4 billion).

The companies have not yet filed their applications for transfer of control. The deal was announced May 26. (http://www.multichannel.com/news/cable-operators/charter-agrees-buy-time...).

Opening a docket means that commenters now have an official place to start commenting for and against the deals. It is also where parties meeting with the FCC about the deals must provide ex parte notices of those meetings. The FCC reminded those parties in the public notice announcing the docket that they have to provide a summary of the substance of those meetings, saying just a list of subjects covered or a "one-or-two sentence description of the views" likely wasn't going to cut it.

Sometimes the onslaught of daily deals and lush forecasts obscures their real importance: They are collective indicators of the industry's direction, overshadowing the big picture (a version of the forest/trees conundrum). While last month included a stunning array of "big deals" in telecommunications and media, their significance looms even larger when, as I've just done, you absorb the whole month's news in a single dose.

For reasons I'll explain below, I was off the grid for most of May, and have just been catching up. Wow, a lot happened in a few weeks, but more importantly, the aggregation of deals and analyses confirms the increasing velocity of the cable/telecom industry overhaul.

Obviously, the biggest deals, especially Charter-Time Warner Cable-Bright House Networks plus Altice-Suddenlink, underscore the consolidation of the industry, especially with Altice's appetite for more acquisitions on this side of the Atlantic. The "internationalization" of domestic cable also pokes through, notably with the role that Liberty Media/Liberty Global can play in bringing content deals across the ocean; Altice may do the same.

I encountered plenty of reports about shifting power - away from programmers and toward pay TV system operators, well covered by Mike Farrell in his "Game Changer" report about the Charter deal. I also skimmed through many interpretations about the impact on equipment makers as the MSO customer base narrows. Deals take time, and this sudden tsunami is affecting all segments of the industry.

Meanwhile, the research factories cranked out plenty of forecast fodder -- all showing the accelerating uptake of over-the-top video viewing. I enjoyed the IHS Infonetics prediction that pay TV operators will aggressively deploy OTT services during the next five years, spurred by DISH's Sling TV venture. The study also concluded that pay TV operators (including cable companies) will offer "skinny bundles" to stave off cord-cutting. Who knows exactly how it will play out, but amidst other predictions, the reports reaffirmed the importance of the OTT juggernaut.

And I saw reports from the digital "NewFronts" and TV Upfronts about the growth of "branded entertainment." I've been following BuzzFeed's aggressive multimedia agenda and was impressed to see it was listed along with Fullscreen and Stylehaul as leading proponents that will make branded entertainment a core offering to their advertisers.

If it works, such sponsored programming can substantially revamp the way that advertisers allot their media budgets -- another major distraction from "business as usual." 

Of course, there was plenty of coverage of "the cloud" as a key to the next wave of delivery, including Charter's vision (thanks to its recently acquired stake in ActiveVideo and its CloudTV service) for a world with limited set-top boxes, replaced by virtualized STBs via the cloud. Maybe we shouldn't embrace everything we read about the cloud -- but one month's heavy dose of cloud stories from several industries convinced me that it's happening now. And much more widely and more quickly than I had considered.

In addition to the daily deluge of forecasts about the growing digital penetration, there was the usual slew of deal-making amongst digital opportunists.  Again, the takeaway was the unrelenting flow of activity.  There were several stand-out developments -- possible game changers -- such as Facebook's launch of its "Instant Articles" feature, which lets publishers post videos and stories directly onto  the Facebook NewsFeed.  Among the blue-chip participants are NBC, BBC and the New York Times.  

Google's new plan to create Android TV "channels" opens the door to hybrid TV that blends traditional TV and online content.  It paves the way for viewers of smart TVs to flip easily between any program source available to them. That's another reminder that non-cable entities will be making more deals with content suppliers that once may have been potential cable content  program sources. The process appears to be underway.

Nielsen's purchase of Innerscope Research, a neuromarketing research company, was a reminder of the necessary new tools being brought into play to assess what viewers like about what they are watching. The deal, along with previous Nielsen investments in similar tools plus other neural research ventures I've encountered in the past few years, reminded me of how important it is for programmers and advertisers to know what viewers are thinking and feeling.  It may not be NSA-level invasiveness, but the personal research is becoming a very big priority.

On the dark side, the latest American Customer Satisfaction Index report, which puts cable (especially Comcast and Time Warner Cable) at the bottom of 43 industries wasn't fun reading. It was a humbling reminder of the competitive challenge ahead from wireless and other carriers when and if they have the capacity.

Maybe it was just my overwhelming, sudden immersion into so many aspects of the business that instilled a sense of a "pivotal moment."  The merry month of May 2015 could someday be identified as a changing point for the industry, or maybe it was merely an accelerator for all the daily developments that we see unfolding but can rarely put into context.

As for my personal reason for uncharacteristic obliviousness during May: I was in hospitals for nearly three weeks. No, not a heart attack or bone-crushing traffic accident. It was "just" a triple whammy of unknown origin: staph infection, pneumonia and blood/gastric problems. After great treatments at Northwestern University medical center in Chicago and later at a Johns Hopkins-affiliated hospital in Washington, D.C. near my home, I've recovered well and am nearly back to what passes for "normal" in my life.  Appropriately, I was felled in Chicago on the eve of INTX cable convention.  The title above was inspired by the movie While You Were Sleeping, a 1995 rom-com that appropriately unfolds in a Chicago hospital (although there was nothing funny or romantic about my hospitalization).

Although I had my tablet, smartphone and TV Everywhere account information with me, I cannot say much about the mind-distraction factors while trapped in uncomfortable beds for weeks. (Blame most of it on inadequate hospital WiFi technology.)  I could say a lot about the boredom of TV programming and the proliferation of automotive commercials, but I'll do that elsewhere. The experience did allow me to binge a bit, such as during AMC's Mad Men marathon prior to the series finale (less enjoyable without my DVR). And there's plenty of admiration for electronic medical records and other health technology, on which I will wax elsewhere.

My thanks to the hundreds of kind remarks and encouraging messages that came in when I posted a health status report on Facebook. Although I treasure all of the comments, and I smiled as I read each message, one posting in particular stood out.   

FCC chairman Tom Wheeler (whom I've known and worked with periodically since the 1970s, just two Ohio boys who came to Washington and got into '70s cable) sent me an "OMG" comment. 

Noting that I had to skip the INTX/NCTA convention, Wheeler said, "Those cable shows can be tough." I don't know if he was referring to what he had to handle when he was NCTA president or to the current reception he receives when he speaks to the NCTA audience (probably the latter).   

But I appreciated his point and replied, "You got THAT right about cable shows."

Now I can't wait until the next one -- and to all the industry overhauls between now and then. Based on the past month, fasten your seat belts. It's going to be an intense period of industry change.

What next? The question lingers in the minds of many after Charter Communications finally hammered out an agreement to acquire Time Warner Cable in a transaction valued at $78.7 billion, while simultaneously inking a deal to bring 2 million-subscriber Bright House Networks into the fold for a cool $10.4 billion.

The deals would give the combined companies 17.3 million video customers, solidly placing it into the second spot among U.S. cable companies and a making it a close third among multichannel video service providers behind the combined DirecTV-AT&T (26 million if its merger is approved by regulators) and top cable MSO Comcast (22.4 million).

The transaction is a pricey one — at 9.1 times 2015 cash flow, the TWC deal has one of the richest multiples in years — but is expected to reap benefits for both Stamford, Conn.-based Charter and TWC shareholders.

According to some analysts, the union brings about $150 million in annual programming costs savings for Charter as a result of the added scale (Charter currently has about 4.3 million video customers). And Charter has said that it will expand broadband services throughout its footprint — particularly in rural areas — as well as expand its WiFi presence, which should earn points with regulators.

The deal also returns to the U.S. cable scene one of its most legendary figures, Liberty Media chairman John Malone, whose vision that added scale could help turn the tide back towards distribution companies from programmers fueled the consolidation wave in the first place. Malone’s $4 billion investment in Charter in 2012 helped drive the former secondary-market cable operator into the big time.

Charter’s initial pursuit of Time Warner Cable in 2013 was thwarted by Comcast, whose $67 billion merger offer was accepted by TWC in February 2014. But resistance from Federal Communications Commission chairman Tom Wheeler and other regulators gave Charter another chance.

Charter still believes it can run operations better, by completing the all-digital upgrade started as part of TWC’s three-year business plan and simply offering better products and better customer service. Charter CEO Tom Rutledge calls it taking transactions out of the business — basically extending the life of the customer and reducing churn — and he is basing a big chunk of the expected $800 million in cost synergies expected from the deal on that exact premise.

The deal is a bonafide game changer for the cable industry, one that highlights the importance of broadband and video scale and could help shift the dominance enjoyed by programmers for years back to distributors.

Many analysts are split on the deal: Some believe Charter paid too much for TWC and will have difficulty in achieving the goals it has set for itself; others believe those goals are too conservative. But there are several undeniable truths that will result from one of the largest deals ever in the cable television industry. Here are five of them.

1It will drive the deal market to new heights. Already one domino has fallen, albeit one week before the Charter deal was announced — midsized operator Suddenlink Communications was sold to European telecom giant Altice for $9.1 billion. Altice, according to reports, was actively involved in the TWC bidding, but dropped out when the bidding got too rich, but not before helping to drive up that price. Still, the telecom giant is hot for U.S. cable and has met with deal brokers and bankers to map out its strategy.

Whether that will include the usual suspects like Mediacom Communications and Cox Communications remains to be seen. At last month’s INTX in Chicago, Cablevision Systems CEO James Dolan let his desire to be acquired or partnered with be known and reports have said that Altice hasn’t ruled out a relationship with the Cablevision. And there are about 10 family-owned cable companies in the U.S. valued at $500 million or more each, so the deal pool is chocked with potential. (Cox Communications said, in a statement attributed to president Pat Esser: “We’ve been clear that Cox is not for sale. We’ll continue to aggressively invest and innovate within our product portfolio and explore other potential growth opportunities that align with our business objectives.”)

Adding to the urgency to sell could be the potential that programmers will make up lost affiliate fees from the stronger Charter — analysts predicted the deal will cost programmers an annual $150 million in license fees currently generated from the merging companies — by raising prices for smaller operators. That and the high multiples being paid for TWC and Suddenlink (estimated at 9.1 times and about 10 times cash flow) could be factors that lead smaller cable companies to the negotiating table. (As an aside, John Malone sold his Tele-Communications Inc. to AT&T in 1998 for an estimated 13 times cash flow).

In addition to Altice, other private-equity firms such as GTCR (which bought New- Wave Communications in 2013), telco TDS (which purchased Bend Broadband in 2014) and Canadian cable company Cogeco (which purchased Atlantic Broadband in 2012) could all re-enter the fray.

“Cable operators inevitably have to sell,” Pivotal Research Group CEO and media & communications senior analyst Jeff Wlodarczak said. “Scale matters, and the bigger Charter and Altice get, the smaller the NCTC [National Cable Television Cooperative] gets and the less leverage the remaining players have, forcing more consolidation.”

But many observers don’t expect a flood of deals until after the Charter-TWC deal closes, expected by the end of the year. Then, all bets are off.

“There is going to be a lot of activity,” said one member of the financial community who asked not to be named. “This is the time in a market when people start making these decisions; to get out now while the price is still good.”

2 Content is no longer king … The continued consolidation of the cable business could finally turn the tide of dominance from content companies, which have imposed sharp increases in affiliate fees as the popularity of their networks grew, to distributors, who continue to control the broadband pipe.

With nearly 66 million television homes locked up with three providers (DirecTV-AT&T, Comcast and Charter) and more than 41.8 million broadband customers controlled by the top two cable companies (Comcast and Charter), distributors would have their best chance in years to flex those muscles with programmers and refuse to carry networks, or at least pare down the bundle of networks they buy.

While that has already been done with with Cable One and Suddenlink’s decision to drop Viacom’s channels several months ago, the real test may be coming in the next few months when Discovery Communications’ carriage deal with Comcast and Dish Network’s Viacom deal expires.

Discovery’s feet will be first to the fire — its current Comcast deal ends on June 30 — and some believe that unencumbered by intense regulatory scrutiny, Comcast may finally be emboldened to drop the company’s networks or push for major concessions. Dish Network’s current Viacom deal, which is estimated to expire at the end of the year, could be a major milestone — a drop could be the final blow for the home of MTV; a deal could bolster it in the eyes of other distributors.

Viacom’s recent deal with midsized MSO Mediacom Communications resulted in a 3% lift in Viacom’s stock price, so investors are watching. Dish chairman and CEO Charlie Ergen has thrown out mixed signals concerning Viacom, on one hand praising the networks for their more than 20-year relationship with Dish, while noting that the media giant’s negotiating leverage has waned in the wake of falling ratings and a talent exodus at key shows.

Wlodarczak wasn’t ready to call for content’s demise, but warned that exorbitant programming price increases could lead to “an acceleration away from pay TV to entertainment alternatives and they will go from analog dollars to digital pennies.”

3 … but broadband is. The combined Charter-TWC-Bright House will control about 19.4 million broadband customers and, perhaps more importantly to federal regulators, about 30% of homes with access to Internet service speeds of 25 Megabits per second or greater. That is still below the 34.6% of 25 Mbps homes controlled by Comcast, but it is a substantial rise and is expected to get even bigger. TWC had targeted adding 500,000 broadband subscribers from digital subscriber line services over three years and Charter’s markets are rife with DSL customers.

Even with the added bulk of DirecTVAT&T, which will have about 26 million video customers if that deal is approved, Charter will far surpass it on the broadband front and has the two-way infrastructure that DirecTV lacks.

“That’s a huge disadvantage,” MoffettNathanson principal and senior analyst Craig Moffett said. Over time, the additional scale could allow Charter and Comcast to compete more aggressively with telcos, and to launch major initiatives on the large-business and wireless markets.

Broadband pricing could be a major issue going forward. While some cable operators are experimenting with usage-based pricing, the new Charter could implement its own take on the concept. Rutledge has said in the past that Charter does not impose usage caps nor does it rely on usage-based pricing and will continue that practice. But that view also could change after the regulatory process ends.

4 Cable operators cooperate more, pushing TV Everywhere service. Malone has always been a big proponent of cooperation between cable operators, believing that the industry dropped the ball early on by not creating a Netflix-like streaming service well before Netflix did. He has also been critical of the way the industry has dragged its feet on the rollout of TV Everywhere service, which while improving is nowhere near its original vision of content anytime, anywhere. Charter CEO Rutledge has said a national service is a “possibility” but left the speculation at that.

Malone has complained in the past that companies like Netflix have to share in the cost of the bandwidth they are using. Netflix did sign a peering agreement with Comcast in 2014, but CEO Reed Hastings immediately criticized the practice of charging more for better access, calling it an “arbitrary tax” for content providers.

A perceived lack of leadership also has nagged at Malone for years. In October 2013 at Liberty Media’ s Investor Day, he told Multichannel News that the previously announced desire by Comcast chairman and CEO Brian Roberts to license its X1 operating system to other operators was a good start toward filling that void.

“It would be magnanimous of Brian to be that kind of a leader and offer his technology to everybody,” Malone said at the time, conceding that some operators may be reluctant to entrust something as important as their technology platform to an outside company, but adding that the industry needs to get past that kind of thinking.

“If the industry is in a situation where nobody trusts anybody, then there is no leadership and nothing is going to happen,” Malone said at the time. Now Rutledge and Malone may be the ones to take the mantle.

5 Programmers will be forced to fight scale with scale. Stronger distribution companies will beget stronger content providers, according to some analysts. And it wouldn’t be unprecedented.

Rupert Murdoch’s 21st Century Fox made an unsolicited $80 billion bid for Time Warner Inc., which was rejected back in June 2014, just months after the Comcast-TWC deal was first announced. While that consolidation wave never came to be, it could be reborn if content providers suspect that burgeoning scale threatens to encroach on their core business.

While Time Warner has proven it can survive on its own — its stock price is now well above Fox’s June offering price — other smaller players may see an advantage in joining forces. Companies like Discovery Communications, Scripps Networks, AMC Networks and Crown Media Family Networks have all been singled out as consolidation candidates in the past several months. And despite denials from both sides, a reuniting of Viacom and CBS also could be a way to counteract distribution scale.

As one cable executive who asked not to be named said, any content provider who doesn’t have sports rights is probably seriously considering what the future will hold, and whether it may be time to consider joining forces with a larger company.

The ongoing soap opera between Charter Communications, Time Warner Cable and Bright House Networks entered its second act Friday after Charter CEO Tom Rutledge confirmed that the company is in talks with Bright House Networks, adding that the Connecticut-based cable operator also is exploring ways to integrate over-the-top offerings into its existing and future bundles.

On a conference call with analysts to discuss first-quarter results May 1, Rutledge confirmed reports that Charter was in talks with the 2-million subscriber MSO.

“Our agreement with Advance Newhouse requires that we negotiate in good faith upon the termination of the Comcast transaction, and we’re doing that,” Rutledge said on the call. He declined to elaborate.

Charter had agreed to purchase Bright House in March in a deal valued at $10.4 billion, but that transaction was contingent on Comcast’s $67 billion purchase of Time Warner Cable being completed.   Comcast’s decision to terminate that deal on April 27 also scuttled the Bright House transaction as well.

While Charter was expected to revisit the Bright House transaction, Time Warner Cable also has the right of first offer for the cable operator and reports have claimed it too is in preliminary discussions with the company as well.

In a research note, Telsey Advisory Group media analyst Tom Eagan has suggested Time Warner Cable could buy  Bright House as a defensive play to discourage Charter from making a second attempt at acquiring the larger operator.  

On the call, Rutledge said that Charter also was investigating whether it could devise new video packages that include direct-to-consumer offerings like Netflix, Hulu and HBO Now.

“We’ve been considering ways to provide compelling services and packages at lower retail price points and with a lower content cost structure and with the inclusion of direct to consumer services all in an offering that satisfies the unserved marketplace,” Rutledge said. “If we can create a new video product that offers real value to this segment we target and that customers will stick with, that also  gives us an opportunity to upgrade customers to our full featured video product as consumer needs change, and obvious we will do it if we can. We haven’t found that product mix yet and we don’t think anyone else has either.”

Later, Rutledge explained that he meant developing offerings that include over-the-top services like Netflix, HBO Now, Hulu and others like that where the purveyor of the content has a direct relationship with the consumer.

“Our view is that we can mix those products into products we sell to satisfy the customers entire video needs,” Rutledge said. “I am assuming that products can be built that would be sold by us within our footprint, but would also include products sold outside our footprint delivered by the Internet, generally but not necessarily.”

When Tom Rutledge became CEO of Charter Communications in late 2011, he annunciated a clear vision of his goals, which centered around his vow for broadband: Be the fastest.

With the proposed purchase of Bright House Networks for $10.4 billion last week, he’s now not only one of the fastest — he’s one of the biggest.

Rutledge and Charter have spent that past three years upgrading plant, boosting HD channel capacity, raising highspeed data service speeds and repackaging video offerings in an attempt to hold on to and grow the operator’s 4.2 million-strong subscriber base.

“We have invested in our plant, our products, our service and our employees,” Rutledge said after announcing the Bright House deal. “Today, we are all-digital; we offer minimum Internet speeds that are some of the fastest in the country; we offer more high-definition channels than do our satellite competitors, all at highly attractive prices, and the results are showing.”

RETURN ON INVESTMENT

Charter has spent about $560 million on upgrades and rebuilds since 2012, and the results have been strong, according to its financial statements. It added 3,000 residential video customers in the fourth quarter and finished the year with 4.3 million video subscribers, down slightly from the 4.34 million in the prior year.

Rutledge has applied to Charter the same principles he applied at his past two jobs: Better customer service, aggressive pricing and even more aggressive packaging. As chief operating officer of Cablevision Systems, he helped introduce the first $90 triple-play package of video, voice and data; before that, as Time Warner Cable’s president, he helped run some of the Bright House systems Charter is now buying. At TWC, he also helped usher in such innovations as the Full Service Network, the precursor for video-on-demand and interactive TV.

At Charter, Rutledge has focused on high-speed data. As soon as Charter markets went all-digital, the Stamford, Conn.-based MSO immediately ratcheted up minimum broadband speeds to 60 Megabits per second. In some Charter markets, the minimum data speed is 100 Mbps, compared with 15 Mbps for the rest of the industry. And Rutledge said he believes speeds can be even faster.

“By going all-digital and investing in all-digital and clearing out our networks and taking full advantage of the capacity of our networks, we can actually add that capacity into the broadband network and take speeds up dramatically at relatively low cost on a per box or per customer basis,” Rutledge said. “We will take our networks and use the networks as well as they can be used by making them all-digital.

“There are digital technologies coming down the line in DOCSIS — DOCSIS 3.1 — which actually take the capacity that we already have and make it even greater,” he added. “That’s a bigger investment in the long run, but still relatively small because you are not rebuilding plant.”

The $10.4 billion purchase of Bright House Networks will add 2.5 million quality cable subscribers to Charter’s rolls. When coupled with the customers Charter will gain in a series of swaps, sales and spinoffs related to Comcast’s pending acquisition of Time Warner Cable, the mid-market Charter will vault into a solid second place among U.S. cable operators and No. 4 among all domestic pay TV distributors, with about 10.1 million owned or serviced customers.

SCALING UP

That could go a long way toward easing Charter’s programming cost burden. With the Bright House deal, Charter crosses the 10 million-subscriber threshold, approaching Time Warner Cable’s current customer tally of 10.8 million subscribers. It was an irony not lost on Rutledge.

“And while it’s not assumed by us, as we now go over 10 million video customers and by programming for 10 million plus video customers, we are kind of in the shoes of where Time Warner was proportionally in the rest of the industry and we had not really assumed that kind of product pricing in our modeling, but it should be available to us over time if we are good negotiators and take advantage of our scale,” Rutledge said.

The deal also gives a vote of confidence to the much-maligned Comcast-Time Warner Cable merger — both Charter deals are contingent on that larger transaction closing. And Rutledge added last week that by removing 2 million video customers (and 1.9 million highspeed data subscribers) from TWC, his deal could make it easier for the Federal Communications Commission to approve the larger deal. Opponents of the $67 billion Comcast-TWC marriage have objected to the combined company’s dominance over the broadband market.

With Bright House, Charter gains markets outside its customary footprint, with Tampa and Orlando, Fla., systems, as well as markets adjacent to its existing properties, with smaller systems in Detroit; Birmingham, Ala.; Bakersfield, Calif.; and Indianapolis.

When Rutledge first joined Charter, the strategy was to build scale organically, not through acquisition. Armed with a stronger balance sheet — a 2009 bankruptcy erased about $8 billion in debt and pumped $3 billion in new equity into the company — Charter finally had the financial wherewithal to invest in its plant and equipment to grow the business.

In a 2012 interview with Multichannel News, Rutledge said the new capital structure removed the obstacles to growth.

“I do think the capital structure makes a huge difference, because it doesn’t handicap management,” Rutledge said at the time. “Management can do what it needs to do to be successful; it can spend money where it needs to spend money and it can spend money to make money. That wasn’t always the case in the past.”

When Liberty Media and cable legend John Malone invested $2.6 billion for a 27% interest in Charter in 2012, the MSO’s growth path shifted toward acquisitions. After a run at Time Warner Cable that ended with Comcast winning the prize, Charter managed to wrangle a consolation prize that could effectively add 3 million owned and serviced customers to its rolls — purchasing about 1.4 million subscribers, swapping systems with about 1.6 million customers and by taking a 33% interest in a spinoff entity called GreatLand Connections with 2.5 million customers, which Charter will manage.

Now, with the Bright House deal, Charter will get a new largest individual shareholder in Advance/Newhouse; its 26.3% stake will outstrip Liberty’s 19.4% equity interest (it will have equal voting footing with A/N at about 25%). And it gains breathing room to pursue further acquisitions.

“The macro trends in the cable business point towards an increasingly greater need for scale — from acquiring programming, to product development, to an increasingly centralized operational approach — which is driving smaller operators to look to get larger and/or exit,” Morgan Stanley cable analyst Ben Swinburne said in a recent research note. “Charter is benefiting from this trend as the natural acquirer for operators serving much of the mid- and smaller-sized footprint in the U.S.”

Pivotal Research Group principal and senior media & communications analyst Jeff Wlodarczak, who recently raised his 12-month price target on Charter to $230 per share from $215 per share, believes the time is right for the operator to start its consolidation binge.

DOMINO EFFECT

“I think this starts the dominos falling, and Charter consolidates most of the rest of the U.S. cable industry,” Wlodarczak said. “But they may want to wait a bit to consolidate these two fairly big deals, likely until sometime in 2016.”

Charter certainly has the currency in a robust stock — its shares were up 8%, or about $10 per share, after the Bright House announcement to $193.11 each — and ample debt capacity, as it will have about $6 billion in available credit lines after the Bright House deal.

There is a line of candidates for possible consolidation. In a note to clients Wlodarczak named four: Suddenlink Communications (private), Mediacom Communications (private), Cable One (planned to be spun off from Graham Holdings as a separate public company this year) and Cablevision Systems (public), with the latter possibly involved in a later system swap with Comcast.

Charter also is expected to eventually acquire the remaining two-thirds of Great- Land Connections, the publicly traded entity that will be spun off as part of the Comcast- Time Warner Cable deal. Greatland will have about 2.5 million customers and will be 33% owned by Charter once it is spun off.

A potentially harsher regulatory environment also could spur consolidation, especially among smaller operators. FCC chairman Tom Wheeler’s moves to regulate cable companies as common carriers could be the final straw for some smaller MSOs. Some pointed toward the last big sea change in the regulatory environment that caused some operators to seek larger suitors— the 1992 Cable Act, which set pricing parameters for cable service.

“It’s forcing people to ask themselves, ‘Is there a place for me going forward?’” said one executive in the cable financial community that asked not to be named.

Charter Communications started the cable consolidation wave a little early, agreeing to buy Bright House Networks in a deal valued at about $10.4 billion.

News of the deal comes a few weeks after speculation that the two were talking about a deal first surfaced. By agreeing to buy Bright House, which has about 2 million customers in Florida, California, Alabama, Indiana and Michigan, Charter removed the cloud surrounding the Advance-Newhouse owned cable company after its partner, Time Warner Cable, is acquired by Comcast. Bright House buys its programming under the same deals as TWC. There was some doubt as to whether that agreement would continue after the Comcast deal is closed.

The agreement, which will take place after Comcast completes its $67 billion TWC acquisition, also is a signal that the parties are confident a transaction will be consummated. Analysts had lowered the odds that the deal would receive Federal Communications Commission approval to about 50-50 after consumer groups and regulators blasted the deal.

The business will be conducted through a partnership (the "Partnership") of which Charter will own 73.7%, and of which Advance/Newhouse will own 26.3%. The consideration to be paid to Advance/Newhouse by New Charter will include common and convertible preferred units in the Partnership, in addition to $2 billion in cash. The partnership units owned by Advance/Newhouse will be exchangeable for common shares of New Charter. The deal is subject to several conditions, including Charter shareholder approval, the expiration of Time Warner Cable's right of first offer for Bright House, the close of Charter's previously-announced transactions with Comcast and regulatory approval.

"Bright House Networks provides Charter with important operating, financial and tax benefits, as well as strategic flexibility," said Charter CEO Tom Rutledge In a statement. "Bright House has built outstanding cable systems in attractive markets that are either complete, or contiguous with the New Charter footprint. This acquisition enhances our scale, and solidifies New Charter as the second largest cable operator in the US. I look forward to working with the Bright House team, whom we have known for years, in delivering great products and services to grow our market share."

Steven Miron, Chief Executive Officer of Bright House Networks added, "We are excited about our transaction with Charter. At Bright House Networks, we are very proud of what we have achieved - from the quality of our infrastructure to the level of service our employees provide to customers every day. We share the same vision for the future of our business as Tom and the Charter leadership team, which is to gain market share by offering customers competitive products and excellent service at a tremendous value. Also, our family has known and worked with Tom Rutledge for more than 20 years. Tom managed cable systems that were part of our partnership with Time Warner Cable prior to the formation of Bright House Networks. We think the combination with Charter gives our employees, our customers and Advance/Newhouse the strongest prospects for the future."

Liberty Broadband, which owns about 27% of Charter stock, has agreed to purchase, upon closing of the Bright House transaction, $700 million of newly issued New Charter shares at the Reference Price. On an as-converted basis of its exchangeable partnership units, and including the impact of both the issuance of shares to acquire 33% of GreatLand Connections Inc. and Liberty Broadband's purchase of new shares, Advance/Newhouse is expected to own 26.3% of New Charter's outstanding common shares, and it is expected that Liberty Broadband's equity ownership will represent 19.4% of New Charter's outstanding common shares.

In connection with the transaction, Advance/Newhouse has agreed to grant Liberty Broadband a voting proxy on its shares, capped at 6%, for the five years following the close of the transaction, such that Liberty Broadband would have total voting power of an anticipated 25.01% at closing. The proxy excludes votes on certain matters.

At the close of the transaction, New Charter's Board of Directors will consist of 13 directors, including three directors designated by Advance/Newhouse and three directors designated by Liberty Broadband.

Goldman Sachs and LionTree Advisors are serving as financial advisors to Charter in connection with this transaction. Wachtell, Lipton, Rosen & Katz is acting as counsel to Charter and Kirkland & Ellis LLP is advising Charter on financing.

UBS Investment Bank is serving as exclusive financial advisor to Advance/Newhouse Partnership and Bright House Networks LLC, and Sabin, Bermant & Gould LLP and Sullivan & Cromwell LLP are acting as legal advisors.

"We're never fans of cable consolidation, and today's acquisition would change the provider for millions of people, but this deal on its own wouldn’t raise too many concerns," said Free Press policy director Matt Wood on news of the planned meld. But the Charter/Bright House deal is contingent on Comcast/TWC getting approved, and that should not happen, says Wood, whose group has been pushing back hard on that deal.

"[I]n conjunction with the Comcast-Time Warner Cable deal, and with the resulting spin-off from that previously announced merger of the new company jointly controlled by Comcast and Charter, this all does raise concerns about the national market power held by the shrinking number of large cable operators and broadband providers. That's why the FCC and the antitrust authorities need to deny disastrous mega-mergers like Comcast-Time Warner Cable first and foremost."

John Eggerton contributed to this report

Bright House Networks and GCI are the latest MSOs to join the Society of Cable Telecommunications Engineers's Corporate Alliance Partner (CAP) program, an initiative that offers new training and education opportunities and one that aims to expand the SCTE’s base of individual members.

They join Comcast, Cablevision Systems, Cox Communications, Liberty Global, Shentel, Suddenlink  Communications, Time Warner Cable, among others. Alpha Technologies and Arris Group are among the known “beta vendor partners” that will SCTE develop a full vendor program that’s expected to launch sometime in 2015.

The SCTE announced the CAP in April, with Comcast, Time Warner Cable and Suddenlink Communications on board as charter members. Program benefits include discounts on individual employee memberships, downloads and registgraotns for SCTE online courses, and seats at SCTE Leadership Institute programs at the Tuck School of Business at Dartmouth and the Georgia Tech Scheller College of Business.

“The Corporate Alliance Program’s unified approach leverages the commitments of operators to enable development of training that anticipates, rather than responds to, industry needs,” said Lindsay Johnston, senior vice president of operations for SCTE, in a statement. “The additional perspectives of Bright House Networks and GCI will allow us to further sharpen the focus of our membership, training and leadership initiatives.” 

Bright House Networks said its Florida systems will serve as the launch site of a new 300 Mbps broadband tier that will be paired with an upstream that maxes out at 15 Mbps.

The faster tier, to become available to all of the residential customers in the operator's Tampa Bay and Central Florida service region later this month, will sell for $199 per month as a stand-alone or as little as $95 more when bundled with other services, Bright House said.

Bright House, which serves about 2.5 million customers, has not announced when it will launch the new 300/15 service in its other systems serving parts of Alabama, Indiana, Michigan and California.

Bright House also markets residential high-speed broadband tiers of 150/10, 75/5, 35/2 and 15/1. It’s also helping to head up an FTTP-based 1-Gig offering for a new housing development in Tampa.

"We continually look for ways to provide the best available choices to our customers. Just a few months ago, we increased our maximum bandwidth offering to 150 Mbps, and now we are making available an additional product at 300 Mbps," Kevin Hyman, executive vice president, cable operations, Bright House Networks, said in a statement. "We've opted to make this product available to our entire Florida footprint meaning millions of Floridians will have this choice available to them."

NetCracker Technology said Bright House Networks has wrapped up the first phase of a large-scale business support system and customer experience transformation program.

Financial terms weren’t disclosed, but the program covers billing system consolidation and replacement, new customer relationship management and e-commerce implementations and a managed services relationship, NetCracker said.

In phase 1, NetCracker worked with BrightHouse to consolidate third-party legacy billing systems across six markets to the vendor’s Revenue Management platform. The MSO also launched a new NetCracker residential CRM platform during that phase. Moving forward, Bright House will extend the CRM to business services.

“After an extensive evaluation, Bright House Networks chose NetCracker because of the quality of its integrated solutions, ability to execute on large-scale transformations and customer focus in managed services,” Jake Perlman, chief information officer at Bright House Networks, said in a statement. “The close alignment of our vision for time-to-market sensitive solutions that empower operational efficiencies and customer self-service was paramount in selecting NetCracker.”

Other NetCracker customers include AT&T, C Spire, Telefonica, BT, Bouygues Telecom, CenturyLink Communications, Cogeco, Kabel Deutschland, RCN, China Telecom, Cincinnati Bell, Blue Ridge Communications, Virgin Media, WideOpenWest, and Lightpath, Cablevision Systems’ big business services arm, among others. 

Bright House Networks said it will start to light up broadband upgrades next month that will boost the downstream speeds of its most popular tiers without raising the price. The MSO also plans to launch a new 300 Mbps offering in “early 2015.”

Bright House said the downstream speeds supported by its “Standard” tier will jump from 10 Mbps to 15 Mbps, while its multiple “Lightening”-level tiers will also get bumped as follows: 30 Mbps rises to 35 Mbps; 60 Mbps increases to 75 Mbps; and 90 Mbps jumps to 150 Mbps.

The operator noted that it will offer its new 300  Mbps service throughout its full service area in Florida early next year, but didn’t say when it expects to launch the speedier new tier in its other service areas. Bright House is also working on a symmetrical 1-Gig service that will initially be available to a new 6,000-home development in the Tampa area.

Bright House noted that its high-speed Internet packages also include access to 40,000 WiFi hotspots across its service areas and about 250,000 hotspots in other markets, coming way of a Cable WiFi roaming consortium that also includes Comcast, Time Warner Cable, Cablevision Systems and Cox Communications.

Bright House serves about 2.5 million customers in parts of Florida, Alabama, Indiana, Michigan and California.

The cable industry is “best positioned” to reap the benefits of voice and data services that prefer WiFi connections and use cellular networks as a backup, but it’ll likely be two or three more years before such offerings are ready for primetime, a leading industry analyst concluded in a new report that sizes up cable’s WiFi opportunities.

While Comcast, Cablevision Systems and other cable operators are rapidly deploying WiFi hotspots in metro areas while also lighting up millions of “homespots” that broadcast second SSID signals as a perk to their wireline broadband services, the industry will be in a great spot to offer so-called “WiFi-first” services, MoffettNathanson Research partner and senior analyst Craig Moffett noted in the report, issued Monday.

“The time is coming when WiFi will shift from being a ‘secondary’ network to being a primary one; instead of thinking of WiFi as an alternative to cellular where WiFi is available, we will instead being to think of cellular as a backup network needed only when WiFi is not,” he wrote, arguing that the recent launch of the iPhone 6, which supports WiFi calling, will accelerate this shift.

While the emergence of the “CableWiFi” roaming alliance between Comcast, Time Warner Cable, Cox Communications, Cablevision and Bright House Networks (and, soon, Charter Communications) offers Internet connectivity to cable modem subs while they are away from home, Moffett envisions a “Stage II” of  a strategy that will position MSOs to offer a substitute to traditional wireless.

“The pieces are seemingly falling into place,” he wrote, noting that Adobe’s recent Mobile Benchmark Report showed that tablet users now consume 93% of all data via WiFi, and 57% of smartphone users consume 57% of their data on WiFi.

Possibly aiding any future WiFi-first strategy is the MVNO option with Verizon Wireless that’s available to Comcast, Time Warner Cable and Bright House Networks. While acknowledging that specific terms of the MVNO arrangement aren’t public, Moffett notes that cable can realize big potential cost savings by offloading as much traffic as possible to its growing WiFi network.

In Moffett’s estimation, the objective would be for the WiFi portion of the network to handle 80% of the offload, with the balance handled by the cellular network/MVNO.

And he doesn’t believe that cable will have to blanket the country with WiFi to make the model work, citing a Cisco Systems study indicating that 90% of all wireless usage happens at retail locations, public locations and travel locations, meaning that a potentially very small number of locations could capture a very substantial amount of wireless traffic.

“The more traffic that can be handled on the WiFi network at near-zero incremental cost, the less that needs to be handed off to the MVNO partner at relatively high incremental cost,” Moffett explained. “Again, the capital spending objective of a WiFi-first operator would not be to provide broad coverage, but instead to minimize usage of the cellular networks as a way to minimize cost.”

Making some assumptions on monthly cellular/MVNO network costs ($7) and G&A expenses ($8) per sub that could be factored in before acquisition costs, Comcast, he surmised, “could achieve positive customer lifetime value” starting as low as $30 per month.

But Moffett warns that he doesn’t expect such a model to take hold anytime soon. “[T]here are technological hurdles that will require at least two to three more years before a Cable WiFi service is ready for primetime,” he wrote, citing the need for more seamless login processes, the addressing of security concerns, and improved connection managers.

However, the emergence of Hotspot 2.0/Passpoint, a technology already being deployed by Time Warner Cable, will provide some answers, and provide carrier-grade WiFi networks with features and capabilities currently offered on cellular networks.

Despite his enthusiasm for how WiFi could play a broader role in cable’s service strategy, Moffett noted that his firm has not factored wireless into its model for Comcast, which he views as the best positioned for a WiFi-first approach.

“Our goal here is to assess the viability of the concept and no more,” Moffett wrote.

As the Canadian government readies hearings next week that could substantially reduce roaming rates for cellular telephone service, Montreal-based cable operator Cogeco Cable – which also has interests in the U.S. cable market – is contemplating creating its own wireless service for its customers.

Cogeco Cable already offers TV, Internet and landline phone service in Quebec and Ontario. In 2012, Cogeco purchased U.S. cable operator Atlantic Broadband in a deal worth about $1.36 billion.

In a statement, Cogeco said it would consider offering its own wireless service if the Canadian government manages to cut prices wireless networks charge to lease their lines. CEO Louis Audet has proposed creating a mobile virtual network operator (MVNO) which would buy network airtime from carriers and resell it to customers.

“Given the high concentration in the Canadian mobile wireless market, Cogeco strongly believes that regulatory measures fostering the entry of MVNOs in addition to other measures will increase competition in the market and enhance consumer choice,”Audet said in a statement. “A regulated MVNO option would definitely be in the best interest of Canadian customers and businesses.”

The Canadian Radio-television and Telecommunications Commission (the chief communications regulator in Canada, similar to the Federal Communications Commission in the U.S.) is scheduled to begin hearings on possibly regulating wholesale roaming rates next week. Cogeco is slated to testify before the CRTC on Sept. 29.

The regulatory agency has pushed for a fourth wireless competitor in the market to compete with Telus Corp., BCE Inc., and Rogers Communications, but hasn’t had much success. The three carriers currently control more than 90% of the wireless market in Canada, and Cogeco believes an MVNO, which would not have to spend the billions of dollars to build its own network, has a better chance of success.

In the U.S., the wireless business has been an elusive one for cable, dating back to the industry’s original partnership with Sprint PCS. Sprint, Comcast, Cox, Time Warner Cable and Bright House Network tried to partner again on a wireless service, called Pivot, which was abandoned in 2008.  In 2011, as part of its agreements to sell its wireless spectrum to Verizon Communications, Comcast, TWC and Bright House negotiated the right to co-market Verizon Wireless service with their cable packages. Cox, which didn’t sell its wireless spectrum in that deal, sold some of its licenses to Verizon later that same year, about a month after abandoning plans to build its own wireless network.

AT&T and Verizon Communications both made significant jumps in Netflix’s ISP Speed Index for August, delivering higher-quality Netflix streams following recent paid interconnection deals between the ISPs and the OTT video giant.

Those gains helped to push the U.S. average speed, as ranked by Netflix, to 2.57 Mbps in August, versus 2.23 Mbps in July, putting the U.S. in 11th place among countries tracked by the streaming service. The Netherlands (3.63 Mbps average) remained the top country, according to Netflix, which has been urging the FCC to include paid peering deals in its vetting of new network neutrality rules and has thrown its weight behind the symbolic Internet Slowdown Day protest slated for September 10.

Among the 16 major U.S. ISPs ranked by Netflix, AT&T U-verse leaped seven spots, to No. 7 on the list, delivering an average Netflix streaming speed during primetime hours of 2.61 Mbps, up from 1.44 Mbps in July. AT&T DSL, meanwhile, hopped two spots, to No. 13, with an average of 1.81 Mbps, up from 1.11 Mbps in July.

Verizon FiOS’s average of 2.41 Mbps for August enabled it to climb two spots, to No. 10, beating its July average of 1.61 Mbps. Verizon DSL averaged 1.31 Mbps for August (versus 970 kbps in July), but still finished last among the large U.S. ISPs as viewed through Netflix’s prism.

Other ISPs also gained. Comcast, which announced its interconnection deal with Netflix in February, rose one spot, to No. 4, swapping places with Charter Communications.

Mediacom Communications, which uses a “transparent” caching system from Qwilt in lieu of Open Connect, a private CDN program that uses Netflix-supplied edge caches, gained two spots, to No. 6.

Several other ISPs lost ground in the rankings, even though some produced better results versus the previous month.

Fresh off an interconnection deal with Netflix announced last month, Time Warner Cable averaged 2.59 Mbps in August, up from 2.16 Mbps in July, but still dropped two spots, to No. 8.

Bright House Networks, Frontier, Windstream, and Clearwire all dropped two spots, and CenturyLink fell three spots.

The top three -- Cablevision Systems, Cox Communications and Suddenlink Communications – finished in the same order as they did in July.

Google Fiber (3.53 Mbps) retained the crown for Netflix’s expanded U.S. ISP rankings.

Following a set of initial deployments in Omaha, Salt Lake City and Las Vegas, CenturyLink has followed up with the launch of fiber-fed, 1 Gbps services to “select locations” in an additional 13 cities where the telco tangles with incumbent MSOs such as Cox Communications, Mediacom Communications, Bright House Networks and Comcast.

CenturyLink is offering 1-Gig to residential and business services to ten of those markets, and only to business customers in the remaining six. While “thousands” of customers have access to those speeds now, CenturyLink will expand access its fiber-to-the-premises (FTTP) network to “hundreds of thousands” of residential and business customers within the next 12 months.

CenturyLink has set up a Web site that tells prospective customers if 1-Gig speeds are available to them. They can also sign up to receive alerts when those speeds do become available.

Here’s a rundown of CenturyLink’s 1-Gig expansion and the primary incumbent cable operator in each market:

Residential and Business:

-Columbia, Mo. (Mediacom Communications)

-Denver (Comcast)

-Jefferson City, Mo. (Mediacom)

-Las Vegas (Cox)

-Minneapolis/St. Paul, Minn. (Comcast)

-Omaha, Neb.  (Cox)

-Orlando, Fla. (Bright House Networks)

-Portland, Ore. (Comcast)

-Salt Lake City, Utah (Comcast)

-Seattle (Comcast)

Business:

-Albuquerque, N.M. (Comcast)

-Colorado Springs, Colo. (Comcast)

-Phoenix (Cox)

-Sioux Falls, S.D. (Midcontinent Communications)

-Spokane, Wash. (Comcast)

-Tucson, Ariz. (Cox and Comcast.

CenturyLink said it is moving ahead with those deployments now while other service providers explore plans to offer 1-Gig services to additional markets, seemingly a veiled jab at providers such as Google Fiber, AT&T and Cox Communications.

Among that group, Cox plans to begin market-wide deployment of 1-Gig speeds by the end of 2016, but will start in the fourth quarter of this year by targeting new residential construction projects and new and existing neighborhoods in three CenturyLink markets -- Phoenix, Las Vegas and Omaha. Cox has also started to unleash upgrades that double the downstream capabilities of its two most popular high-speed Internet tiers.

“While some providers talk about bringing broadband speeds of 1 gigabit per second to their customers in the future, CenturyLink is delivering these speeds today to thousands of residential and business customers, making us one of the fastest broadband providers in these communities,” said Shirish Lal, CenturyLink senior vice president of marketing, in a statement. “We are providing these cities a reliable network with ultra-fast broadband speeds that help create a foundation for a strong community, attract new businesses and drive economic growth.”

Bright House Networks is the latest MSO to get aggressive on the home networking front with the launch of a home networking initiative that centers on WiFi-fueled DOCSIS gateways.

The MSO’s new “Echo” service, initially offered in its Tampa and Central Florida systems, features two Arris-made DOCSIS 3.0 models – the DG1670, a data gateway, and the TG16782, a gateway that also supports IP voice services. Among them, DG1670 supports 16x4 D3 channel bonding (16 downstream and 4 upstream channels) and 802.11n MiMo WiFi with dual 2.4 GHz and 5 GHz radios and “beamforming” capabilities. The Arris product specs note that the DG1670 also supports an option for MoCA 1.1 for high-speed networking over a home’s coax-based network.

Bright House said the devices powering the Echo offering expand home networking coverage and eliminate so-called “WiFi dead zones.” Bright House hasn’t announced when it will extend Echo to systems serving areas such as Bakersfield, Calif.; Detroit, Mich.; and Birmingham, Ala.

Bright House joins operators such as Comcast and Cablevision Systems that are ramping up deployments of advanced wireless gateways that integrate DOCSIS 3.0 cable modems. Comcast and Cablevision are also using those devices to broadcast separate SSIDs that turn those devices into quasi-public community hotspots that can be accessed by their respective cable modem subs.

That integrated strategy is in contrast to the one underway at Charter Communications. Instead of integrating the home networking piece, Charter has been leasing out separate 802.11ac WiFi routers made by Netgear and outfitted with Charter-specific middleware.

Add two more major distributors to SEC Network’s growing affiliate roster.

ESPN has reached a carriage contract with Time Warner Cable and Bright House Networks across the cable operators’ entire base of systems in time for SEC Network’s launch on Aug. 14.

The agreement, financial terms of which were not disclosed, follows recent affiliate pacts with Comcast and Cox Communications. All told, the sports giant says at this point the SEC Network will be available to 60 million households at launch. SEC also has deals with charter affiliate AT&T U-verse, Dish Network and Google Fiber, among others. DirecTV, Verizon FiOS and Charter Communications have yet to sign pacts with the fledgling service.

As is the case with other affiliates, Time Warner Cable has committed to a widely penetrated package within the conference’s 11-state footprint – it will place the SEC Network on its standard level of service for its systems operating in Alabama, Kentucky, Missouri, South Carolina and Texas. The channel, presenting over 1,000 live events in its freshman year, including 45 games from the nation’s preeminent football conference, will be offered on digital on TWC's other systems.

The deal ensures that subscribers at the nation’s No. 2 MSO will be able to see the network’s football opener on Aug. 28, when the South Carolina Gamecocks host Texas A&M at 6 p.m.

The same positioning game plan will be in play at Bright House, whose programming deals are negotiated by Time Warner Cable: it will offer SEC Network on standard in Florida and Alabama, and on its digital package in Indiana, Michigan and California. The MSO has a strong presence in central Florida – the Sunshine State is home to the Florida Gators – and serves Birmingham, the home DMA for the Alabama Crimson Tide, the perennial football power.

"We know we have customers who want the SEC Network, and are pleased to bring it to them," said Andrew Rosenberg, senior vice president of content acquisition for Time Warner Cable.  "This deal will help ensure that fans and alumni of SEC universities won't miss any important games."

Noted Sean Breen, Disney and ESPN Media Networks senior vice president, affiliate sales: “By delivering the SEC Network across Time Warner Cable and Bright House Networks’ nationwide footprint, including key markets within SEC territory, we are meeting the demands of fans while also adding value to customers’ video subscriptions in advance of the network’s launch next month.”

Bright House Networks has launched four EPIX networks.

The nation’s sixth-largest cable operator is now making EPIX, EPIX2, EPIX4 and EPIX Drive-In to its customers, in the standard- and high-definition formats. To entice purchase of the premium programmer’s film, music and comic fare, Bright House is giving its digital TV customers free access to EPIX, including its multiplex, for three months.

EPIX content is also available to Bright House subscriber via the on-demand platform, and is expected to be available online soon.

A joint venture among Viacom Inc., its Paramount Pictures unit, Metro-Goldwyn-Mayer Studios Inc. and Lionsgate, EPIX is available to more than 45 million homes nationwide via distribution deals with Time Warner Cable, Charter Communications, Cox Communications, Hawaiian Telecom, Dish Network, Mediacom Communications, Suddenlink Communications, Verizon FiOS TV, and the National Cable Television Cooperative.

“EPIX is pleased to be partnering with Bright House Networks to deliver thousands of hit movies, concerts and original documentaries to their subscribers on any platform and any screen,” said Mark Greenberg, president and CEO of EPIX.  “Bright House Networks is known for its strong portfolio of products and services and its commitment to delivering an outstanding customer experience. We are delighted to be building on that reputation and helping to enhance their offering to customers while expanding our own footprint.”

The deal emanates from the far-ranging pact Time Warner Cable reached with Viacom last November. The nation’s No. 2 cable operator, which negotiates programming deals for Bright House, engaged in a similar rollout program with EPIX back in March.

EPIX film lineup includes The Hunger Games: Catching Fire (pictured), Anchorman 2: The Legend Continues, The Wolf of Wall Street. It also showcases foncerts featuring Pinl and Madonna, comedy specials with Patton Oswalt, Louis C.K. Jenny McCarthy and Dennis Miller and original documentaries such as Schooled: The Price of College Sports and Forgotten Four: The Integration of Pro Football.

Verizon Communications has picked Tampa as the next launch site for a new “Quantum”-level video packages that include a high-end whole-home DVR set-up that is capable of recording as many as 12 shows at once and storing up to 200 hours of HD video. 

Verizon, which duels with incumbent MSO Bright House Networks as well as DirecTV and Dish Network  in the market, said it has launched its new FiOS Quantum TV packages in parts of Hillsborough, Pinellas, Pasco, Polk, Manatee and Sarasota counties.

The telco’s new FiOS Quantum TV-Premium and FiOS Quantum TV-Enhanced Service tiers both feature the Arris-made Verizon Media Server (VMS), a device that’s outfitted with six tuners and 1 terabyte of DVR storage – enough for about 100 hours of HD video – that can be paired up with client devices that hang off a MoCA-based home network. All of those devices are capable of supporting trick-play functions (pause, rewind, fast-forward, etc.). 

The Premium-level bundle ties together the functions of two VMSs, giving customers access to twelve tuners – enough to record 12 shows at once – and 2 TB/200 HD hours of DVR storage. To counter that offer, Cablevision Systems Corp. recently implemented an upgrade that enables its network-based Multi-Room DVR to record up to 15 shows at once. Dish Network’s Hopper HD-DVR with the Super Joey can record up to eight shows at once,  while DirecTV’s Genie whole-home DVR and Comcast’s X1 platform each can currently record up to five shows at the same time.

“Expanded storage space means FiOS Quantum TV customers can store full seasons of shows they want to watch and binge on,” said Bob Mudge, president of the consumer and mass business  unit of Verizon, in a statement. “More storage, more recording capabilities and more in-home viewing control enhance the TV viewing experience.”

Verizon said FiOS TV is available to nearly 1.3 million homes and businesses in the Tampa Bay region.

Verizon debuted its FiOS Quantum TV offerings last month in Dallas and Harrisburg and Pittsburgh, Pa., and expects to phase it into all other FiOS TV markets over the next few months.

Existing customers who take one of the new Quantum TV packages will be subject to a one-time upgrade fee of $24.99. The Enhanced-level tier is an additional $22 per month, while Premium runs $32 per month. Those monthly lease fee will vary based on the number of TVs supported in the subscriber’s home.

Verizon ended the first quarter of 2014 with 6.2 million FiOS Internet and 5.3 million FiOS TV connections.

Bright House Networks has joined a growing number of cable operators that have tapped iControl Networks to power a new set of home security and automation services.

iControl said the MSO is using its “Converge” software platform to operate the Bright House’s Home Security & Control product, which, according to an official, has been rolled out in Tampa and Central Florida. 

Bright House has tapped in to offer a mix of centrally monitored and self-managed security and smart home features, including energy, light and home appliance management via an in-home touchscreen (pictured above), on Web browsers and on smartphones and tablets.

“We’re excited to partner with Bright House Networks to bring advanced home control, security and connectivity to their customer base,” said Jim Johnson, executive vice president and general manager at iControl, in a statement. “Bright House Networks customers will quickly appreciate how simple it is to manage their homes and gain the reassurance that comes with a home management service like this."

Bright House joins an expanding list of MSOs that now work with iControl. Others include Comcast, Cox Communications, Rogers Communications, Time Warner Cable, and Comporium, among others.

Last month, iControl acquired Blacksumac, a Canada-based startup that has developed an all-in-one wireless-based home automation and security system that carriers the “Piper” brand. iControl said the “strategic acquisition” will allow it to expand its connected home management portfolio and target new markets, including rental properties and apartments, in the U.S. and abroad.