Comcast’s long drawn out, overly criticized proposal to purchase Time Warner Cable is dead.
After failing to win the approval of regulators and legislators, the US cable giant has rescinded its $45bn dollar deal to buy one of its largest competitors.
“Today, we move on,” said Comcast chairman Brian L Roberts. “We structured this deal so that if the government didn't agree, we could walk away.”
In a statement, US attorney general said “The companies’ decision to abandon this deal is the best outcome for American consumers.”
“This is a victory not only for the Department of Justice, but also for providers of content and streaming services who work to bring innovative products to consumers across America and around the world.”
An antitrust probe into the deal was launched in March 2014. Since then, it’s been heavily scrutinized by the Federal Communications Commission, as well as politicians and consumer / industry groups. Namely, the fact that Comcast and Time Warner Cable are two of the biggest cable companies, as well as two of the largest broadband providers, in the US.
Comcast tried to make the argument that they served different markets and that the merger would not reduce competition for consumers. They pointed out that while Comcast operates mostly around Washington DC, Chicago, Boston, and Philadelphia, Time Warner Cable services New York, Los Angeles, Milwaukee, and Dallas.
The decision is certainly a blow for Comcast and Time Warner Cable, and it will have ripple effects on other companies in the industry. For instance, Charter Communications, the fourth largest cable company operating in the US, will no longer acquire parts of the Time Warner Cable markets that Comcast was planning to divest.
Via BBC
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