Comcast will buy MediaOne in deal worth $53 billionp: No. 3 in cable business; High-speed access to Internet is the driving force behind industry consolidation

Article Abstract:

In an effort to place themselves at a strategic advantage in offering high speed Internet access, Comcast Corp., has floated a $53 billion merger offer for cable television rival, MediaOne. Both cable companies are looking to forge a company that can beat the telecommunications industry in the race to offer high speed data links to consumers. Comcast Corp., based in Philadelphia, is offering 1.1 share for each share in MediaOne, of Engelwood, Colorado. Paradoxically, Media One has a market value of $41.7, which is considerably more then Comcast's market value of $24.4 billion. However, MediaOne is the last large publicly held cable television company available, so the merger, pending approval, makes strategic sense. The cable television industry as a whole is playing catch-up with the telecommunications industry in offering high speed data links to consumers. It is thought that once consumers make a decision about which type of access they want, it will be hard to change their minds. Hence, the race among cable television and telecommunications companies to position themselves as the provider of first choice.

United States, Mergers, acquisitions and divestments, Company acquisition/merger, Comcast Corp., CMCSA, MediaOne

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Time Warner is step closer to Turner deal; US West's objection is blocked by ruling

Article Abstract:

A Delaware judge ruled that Time Warner's joint ownership of Time Warner Entertainment with US West should not prevent the company's pending $7.5 billion acquisition of Turner Broadcasting System. US West felt that its agreement with Time Warner precluded the company from purchasing any companies that directly competed with Warner Brothers outside of their jointly owned Time Warner Entertainment. However, the courts deemed Time Warner's interpretation of the agreement reasonable. Time Warner now faces an FTC investigation of the deal's antitrust implications before the deal can be completed. US West's objection to the purchase is part of a larger disagreement between the two companies. Time Warner has been attempting to restructure the jointly owned Time Warner Entertainment, which would leave Time Warner with ownership of the Warner Brothers and Home Box Office and US West with the company's cable operations.

Cable TV Movie Networks, Cases, Time Warner Inc., U S WEST Inc., USW, TWX, Entertainment industry, Cable networks (Television), Litigation, Movie networks (Television), Lawsuit/Litigation

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TCI may drop cable services, indicating a shift in power

Article Abstract:

Tele-Communications (TCI) CEO John C. Malone, in a gesture suggesting the increased leverage of cable operators over programmers, has indicated that the company may drop several cable services. Malone said the services, which include the Chicago Tribune's WGN and Time Warner/Viacom's Comedy Central, were not popular or profitable enough. Analysts say that Malone's actions will cause other cable operators to review their programming, which is becoming more costly. Dropping the programs is just one of several cost-cutting actions Malone will take to increase company profits. Malone has also announced his intention to retain control of the company. The family of Bob Magness, the former TCI chairman who died in Nov 1996, currently has 26% of TCI's voting power, while Malone has 18%.

Planning, Television broadcasting industry, Company services, Company business planning, AT&T Broadband and Internet Services Inc., TCOMB

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