Charter Jumps Gun on TWC Restructuring
Although Charter is still waiting on official approval to acquire Time Warner Cable and Bright House Networks, integration plans for both MSOs are already well underway.
According to a document shared by an internal source, "New Charter" sent a communication to Time Warner Cable employees about a month ago detailing plans to shift operations from select TWC and Bright House network centers to existing Charter facilities in St. Louis, Mo. and Austin, Texas. The source reports that regional TWC executives appeared to be "blindsided" by the mass email and had little reassurance to offer existing employees beyond encouraging them to explore potential job opportunities in the new locations.
Affected Network Operations Centers (NOCs) as detailed by the mass email include Time Warner Cable Inc. (NYSE: TWC) facilities in: Charlotte, N.C.; Herndon, Va.; and Syracuse, N.Y. A Bright House Networks NOC in St. Petersburg, Fla. is also among the sites affected. The overall transition is supposed to begin six months after the two Charter acquisitions close and could take as long as 18 months to complete.
Asked about the restructuring plans, a Time Warner Cable spokesperson did not deny any details, but did suggest that communications had been smoother than the recount above implies.
In a statement provided to Light Reading, the spokesperson said: "Over the last several months, we've worked closely together on integration planning and communications. The Charter team is very respectful of TWC employees and we are pleased with the process."
A Charter Communications Inc. spokesperson expressed disbelief that any executives had been blindsided by communications about the planned merger transition, saying that "the management teams of all three companies have been working in lockstep," including the communications departments.
Corporate mergers inevitably produce friction, and it's not unexpected to see Charter planning to close certain offices to reduce redundant operations. What's interesting to see is how much of the plans to consolidate MSO facilities appear to have been decided and widely communicated internally before regulatory approval was virtually assured.
The US Department of Justice approved the Charter deals with conditions yesterday at the same time that Federal Communications Commission (FCC) Chairman Tom Wheeler announced he is also recommending approval with conditions in place. The full Commission still has to vote on the matter, but with Wheeler's endorsement, approval by the FCC is expected. The final hurdle for Charter is likely to be overcome on May 12 when the California Public Utilities Commission hands down its regulatory decision. As with Chairman Wheeler, a state judge in California has already recommended approval with conditions. (See Wheeler Recommends Charter Deals.)
— Mari Silbey, Senior Editor, Cable/Video, Light Reading