"We believe this transaction is approvable," Comcast Chief Executive
Comcast stressed that the deal is not anti-competitive, primarily because neither Comcast nor Time Warner Cable have overlapping service areas. "I think we will get real scrutiny," Roberts said, but he noted that the deal "does not reduce competition in any market or in any way."
Roberts also said that "we believe this transaction will have significant benefits to consumers," pointing out that Comcast pledged to upgrade the quality and speed of Time Warner Cable's vast network and offer more innovative services -- such as selling movies directly to homes -- in order to better compete.
Comcast on Thursday unveiled terms of the agreement, which would give the cable giant nearly 30 million subscribers in the nation's largest markets, including New York, Los Angeles, Chicago, Philadelphia and Washington.
Comcast would have a presence in 19 of the top 20 markets of the U.S. -- an unprecedented reach for a cable and Internet service provider.
However, the merger would not give Comcast more subscribers than it had a decade ago, following two earlier mergers, when federal rules prevented a cable company from serving more than 30% of the nation's homes.
Comcast also said that, after the deal closed, it would divest about 3 million subscribers so that the company would not exceed 30 million cable TV and Internet service customers. Previously, the
When Comcast acquired
Comcast is betting that it can clear regulatory hurdles because the pay-TV landscape has gotten significantly more competitive in recent years. Telephone companies
But media activists don't share that view.
"An enlarged Comcast would be the bully in the schoolyard, able to dictate terms to content creators, Internet companies, other communications networks that must interconnect with it, and distributors who must access its content," said John Bergmayer, a senior staff attorney at Public Knowledge.
"What's more, it is simply dangerous for a large proportion of our nation's critical communications infrastructure to be in the hands of just one provider," he added.
Comcast would gain 8 million Time Warner Cable subscribers in the deal, which the companies would like to finalize by the end of the year.
"This combination is a truly special one," said Rob Marcus, Time Warner Cable's recently installed chief executive.
Time Warner Cable had earlier rejected a bid from
In Los Angeles, Comcast would take over Time Warner Cable's 1.5 million subscribers and its two regional sports networks. In addition, Comcast would take over Time Warner Cable's 26.8% interest in Sterling Entertainment Enterprises, which does business as SportsNet New York.
Comcast would acquire 100% of Time Warner Cable's 284.9 million shares outstanding for shares of Comcast common stock, amounting to approximately $45.2 billion in equity value.
Current Time Warner Cable shareholders would own 23% of Comcast. Shareholders of both companies must approve the deal.