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Cable Has One Thing Verizon NeedsCable Has One Thing Verizon Needs

Verizon buying Comcast or Charter? Preposterous! Except...

Mari Silbey

January 17, 2017

2 Min Read
Cable Has One Thing Verizon Needs

Speculation has officially run rampant with a report out by the New York Post that Verizon is considering a purchase of one of the largest cable companies in the US. There are many reasons why the very idea is ridiculous, but that won't stop the rumor mill from churning, particularly after UBS analyst John Hodulik stated late last year that a Trump Administration could make it easier for such a large-scale merger to pass regulatory muster.

Combatting the logic of a major cable acquisition (e.g., Comcast or Charter) is the fact that the cost would be ginormous. Plus, Verizon Communications Inc. (NYSE: VZ) would gain a bunch of fixed-line broadband customers it never wanted, and technology integration would be a nightmare.

Also, can you imagine Brian Roberts selling to Verizon?

I'd chalk the whole thing up to fanciful thinking, except for one thing. Verizon desperately needs last-mile wireline support for its future as a 5G wireless provider.

5G networks are on the horizon. For all the latest news and insight, visit the 5G site
here on Light Reading.

Verizon is currently on a major fiber kick, but it can't compete with the installed last-mile infrastructure that the big cable companies already have in the ground. That means it's going to have to pay cablecos for capacity in local markets, and if it's going to fork over money anyway, maybe an acquisition looks like the smartest move. (See Analysts More Than Bullish on Comcast MVNO.)

I still say the idea of Verizon buying Comcast Corp. (Nasdaq: CMCSA, CMCSK) or Charter Communications Inc. ) is a long shot. But on the other hand, I didn't predict the MVNO agreement that Verizon made with the cable industry back in 2012. When it comes to telecom M&A, you just never know.

— Mari Silbey, Senior Editor, Cable/Video, Light Reading

About the Author(s)

Mari Silbey

Senior Editor, Cable/Video

Mari Silbey is a senior editor covering broadband infrastructure, video delivery, smart cities and all things cable. Previously, she worked independently for nearly a decade, contributing to trade publications, authoring custom research reports and consulting for a variety of corporate and association clients. Among her storied (and sometimes dubious) achievements, Mari launched the corporate blog for Motorola's Home division way back in 2007, ran a content development program for Limelight Networks and did her best to entertain the video nerd masses as a long-time columnist for the media blog Zatz Not Funny. She is based in Washington, D.C.

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