Light Reading

Comcast-TWC Deal Stalls Netflix Cable Push

Mari Silbey
2/18/2014
50%
50%

With the ink barely dry on Comcast's deal to buy Time Warner Cable, Netflix is already feeling the effects of one of the industry's biggest proposed mergers on record.

Bloomberg is reporting that talks between Netflix Inc. (Nasdaq: NFLX) and Time Warner Cable Inc. (NYSE: TWC) to put the video streaming service on cable set-top boxes have been put on hold until TWC's acquisition by Comcast Corp. (Nasdaq: CMCSA, CMCSK) (which still must be approved by regulators) is completed. That, in turn, could throw a big monkey wrench into Netflix's plans to start taking the US cable industry by storm this year.

Netflix has gained some traction with cable operators in Europe and currently has its streaming service on set-tops from Virgin Media Inc. (Nasdaq: VMED) and com hem AB . However, the video rental giant has not been able to close any deals with cable providers in the US. Time Warner Cable was apparently considering an agreement with Netflix, but those negotiations have been put on the back burner now thanks to the Comcast merger deal. (See Com Hem Rolls Out Netflix.)

There are fears in the video industry, especially among content providers, that a combined Comcast/TWC entity would control too much of the television distribution network in the US. It's not just size that's at issue. Comcast is also much more cautious than Time Warner Cable about partnering with alternative platform providers, and much more ambitious about rolling out its own services that are competitive with over-the-top (OTT) offerings.

For example, while Comcast has its own app on the Xbox 360, it hasn't followed TWC's lead in pushing an app out to numerous other video platforms. Comcast has also blocked HBO Go for its subscribers on the Roku box, preventing users from accessing more content from Home Box Office Inc. (HBO) on a Roku Inc. device than they can on a Comcast set-top.

On the services side, Comcast has been aggressive about building up its video-on-demand (VoD) library. Plus, the company's Streampix offering is a first step into the subscription-based VOD rental market, where it competes against the likes of Netflix. (See Comcast Goes OTT to Target Netflix, Hulu Plus.)

Time Warner Cable, on the other hand, has followed a strategy of offering its core video service on as many different video platforms as possible. The company added Kindle Fire tablets from Amazon.com Inc. (Nasdaq: AMZN) to its distribution list in December alongside iOS and Android devices, Roku players, Microsoft Corp. (Nasdaq: MSFT)'s Xbox 360, and select Samsung Electronics Co. Ltd. (Korea: SEC) connected TVs. There are also rumors that TWC was planning to debut service on the new Apple TV set-top device, which Apple Inc. (Nasdaq: AAPL) is targeting for launch in April. (See TW Cable Says: Just Keep Streaming.)

There is no way to know how Comcast might proceed in talks with Netflix if and when the acquisition of TWC is completed. However, Comcast's track record suggests that Netflix may need to reconsider its near-term plans for a cable partnership. The perspective from the cable industry has changed.

— Mari Silbey, special to Light Reading

(4)  | 
Comment  | 
Print  | 
Oldest First  |  Newest First  |  Threaded View
KBode
50%
50%
KBode,
User Rank: Light Sabre
2/18/2014 | 5:38:56 PM
Unfortunate
I think that's unfortunate, and the X1 would only be better for including additional content options for users. Have been using a Roku 3 for the first time lately and have been very impressed with the myriad of additional channels. I understand Comcast wants to funnel consumers to their own content options and Streampix, but it seems to me like giving consumers some additional options wouldn't necessarily be a bad thing for a company with one of the worst customer satisfaction scores in any industry.
albreznick
50%
50%
albreznick,
User Rank: Blogger
2/18/2014 | 8:20:02 PM
Re: Unfortunate
I agree, Karl. I think one of the best things that TWC has done is give customers these other platforms and options for services. Comcast is fancying itself too much like Apple, but without the same level of customer service. We'll see how much TWC customers complain pnce the deal goes thru. 
Phil_Britt
50%
50%
Phil_Britt,
User Rank: Light Sabre
2/19/2014 | 7:37:20 AM
Control of content
The concern over control of content is certainly legitimate, and could be an item that regulators consider closely before letting a deal go through. I'm not sure the objections will hold up in today's environment -- there used to be rules about concentration of media holdings in a local market, but they've gone by the wayside.
kq4ym
50%
50%
kq4ym,
User Rank: Light Sabre
2/19/2014 | 7:54:47 AM
Re: Control of content
The Comcast-TWC deal is certainly going to find some valid objections. It may very well be that when the deal solidifies lots of providers may be locked out, like the Netflix deal. Whether regulators will take a careful look at how the merger will play out in reality is of great concern to the industry.
Flash Poll
From The Founder
The Swedish vendor has undergone a significant transformation during the past few years, adjusting to the demands of next-generation communications companies.
LRTV Documentaries
The 3GPP's Road to 5G Standardization

4|17|15   |   4:43   |   (0) comments


Satoshi Nagata, chairman of the 3GPP's TSG-RAN group and a manager at NTT Docomo, explains the standardization process for 5G, as well as the biggest challenges and opportunities.
LRTV Documentaries
AlcaLu CTO Makes the Case for a New 5G Air Interface

4|16|15   |   3:54   |   (0) comments


Michael Peeters, CTO of wireless at Alcatel-Lucent, explains why 5G will require a new air interface to meet its diverse performance targets.
LRTV Documentaries
AlcaLu + Nokia: The New Uber-Vendor

4|15|15   |   2:42   |   (4) comments


Heavy Reading Senior Analyst Gabriel Brown discusses the technological and competitive opportunities and challenges if a merger between Alcatel-Lucent and Nokia comes to pass.
LRTV Huawei Video Resource Center
Huawei's Data Center Power Play

4|15|15   |   6:22   |   (0) comments


Huawei has developed industry-leading energy efficiency capabilities for its indoor and outdoor data center solutions, explains Dr. Fang Liangzhou, vice president of Huawei's Network Energy product Line.
LRTV Huawei Video Resource Center
Huawei’s Routers, Switches Get the Green Mark

4|15|15   |   2:02   |   (0) comments


TUV Rheinland's Frank Dudley explains how Huawei's routers and switches have been successfully tested by energy efficiency experts and have gained Green Mark Certification.
LRTV Documentaries
A Finn, a Frenchman & a Guy From New Jersey Walk Into a Merger...

4|15|15   |   3:17   |   (0) comments


Stop us if you've heard this one before... Light Reading CEO Founder & CEO Steve Saunders weighs in on the technical and cultural implications of a Nokia and Alcatel-Lucent merger.
LRTV Huawei Video Resource Center
Accounting for Better Solutions

4|10|15   |   02:31   |   (1) comment


Murad Yousuf, CTO at Saudi Arabia's Ministry of Finance (Dept. of Zakat & Income Tax), talks about the benefits of deploying router technology from Huawei.
LRTV Huawei Video Resource Center
What's in Store for Huawei & DataCore?

4|10|15   |   05:44   |   (0) comments


At the CeBIT trade show in Hannover, Germany, George Teixeira, CEO of software-defined storage (SDS) specialist DataCore Software, explains why he has just signed a partnership agreement with Huawei Technologies.
LRTV Huawei Video Resource Center
Du Puts Its Faith in Huawei's Routers

4|9|15   |   3:42   |   (0) comments


Adnan Masood, director of Enterprise MS Solutions Marketing at du, the United Arab Emirates (UAE) operator also known as Emirates Integrated Telecommunications Company, explains why his company chose to use Huawei's multifunctional AR routers as part of its managed enterprise services.
LRTV Huawei Video Resource Center
Huawei Gets Active in the Data Center

4|9|15   |   3:17   |   (0) comments


With enterprise users looking to maximize the use of their data center assets, Huawei’s Chief Architect & Technical Director of IT Data Center Solutions, Bruce Su, explains how the company's six-layer active-active data center solution is eradicating the need to deploy passive, redundant data center assets.
LRTV Huawei Video Resource Center
Blue Consult & Huawei for a Better Solution

4|8|15   |   4:01   |   (0) comments


Martin Rott, CEO, and Marc Metzler, head of sales virtualization, from Germany's Blue Consult discuss their collaboration with Huawei and TrendMicro to develop a secure, scalable IT platform that can meet the needs of the most demanding enterprise users.
LRTV Huawei Video Resource Center
Beach Petroleum on eLTE & Mining

4|8|15   |   3:09   |   (0) comments


Network systems integrator Jeremy Hamlyn explains how Huawei's secure packet-based trunking communications system, eLTE, can help remote communities and companies in the mining, oil and gas sectors, deploy efficient communications networks that are perfect for video and data as well as voice.
Upcoming Live Events
May 5, 2015, Hyatt McCormick Place, Chicago, IL
May 6, 2015, Georgia World Congress, Atlanta, GA
May 12, 2015, Grand Hyatt, Denver, CO
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 8, 2015, Chicago, IL
June 9-10, 2015, Chicago, IL
June 9, 2015, Chicago, IL
June 10, 2015, Chicago, IL
September 29-30, 2015, The Westin Grand Müchen, Munich, Germany
November 11-12, 2015, The Westin Peachtree Plaza, Atlanta, GA
All Upcoming Live Events
Infographics
Network Instruments, a JDSU division, shares results from its 2015 State of the Network, a global survey on security.
Hot Topics
Verizon Scores New OTT Content Deals
Mari Silbey, Independent Technology Editor, 4/16/2015
Can WiFi Calling Find Its Voice?
Iain Morris, News Editor, 4/13/2015
Senator Proposes New 'Title X' for Net Neutrality
Carol Wilson, Editor-at-large, 4/13/2015
Nokia, Alcatel-Lucent in Merger Talks
Iain Morris, News Editor, 4/14/2015
Nokia & Alcatel-Lucent: What's Going On?
Ray Le Maistre, Editor-in-chief, 4/15/2015
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Data Center Interconnect, or DCI, is one of the hottest sectors in telecom currently. Since coming back to Light Reading last year, prodigal-son style, I've ...
LR CEO and Founder Steve Saunders sits down with the head of Qosmos to talk about the changing state of the art in deep packet inspection technology, including its role in SDN and NFV architectures.
Cats with Phones
Steve's Phone Click Here
Steve Saunders's personal phone.