[June 20, 2005] Special Report: Adelphia Deal Better Positions Cable Cos to Provide VoIP Tweet Kagan Research says the Adelphia deal will allow major MSOs to achieve new efficiencies in critical areas such as new service rollouts, ad sales and marketing. BY JOHANNE TORRES TMCnet VoIP Minute Watch Columnist According to a research study conducted by research firm Kagan Research, the recent Adelphia deal will allow major MSOs to achieve new efficiencies in critical areas such as new service rollouts, ad sales and marketing. The firm revealed that it thinks consolidation will also help cable operators assemble more attractive bundles as the industry's next (even if we all involved in the industry think is the current) killer app, VoIP telephony, rolls out. The firm calls the acquisition of Adelphia by Comcast and Time Warner the fifth largest deal in cable history. Analysts believe that the deal dramatically improves both MSOs' clusters, enhances their size and synergies and provides significant tax savings for each. According to Kagan Research senior analyst Robin Flyn, "This deal is also expected to trigger a series of secondary swaps and sales involving other MSOs, resulting in a more efficiently structured cable landscape and stronger competitive positioning vs. DBS." The firm revealed that Comcast has kept a small piece of New York, but the number one market still belongs chiefly to Cablevision and Time Warner. Analysts believe that Time Warner has succeeded in consolidating most of Los Angeles, except for small pieces owned by Charter and Cox. However, the firm explains, Chicago, Philadelphia, Boston and San Francisco are in Comcast's hands, after it was able to boost Boston subs 10 percent following the Adelphia trades. Comcast, however, has exited Dallas, which Time Warner now shares with Cox and Charter. The study revealed that Washington, DC, and Atlanta are also split markets: Comcast was able to grow in DC, but shares that market with Cox, while in Atlanta Comcast shares the DMA with Charter. In all, Comcast has approximately 10.6 million subscribers in the top 10 DMAs vs. the 3.9 million held by Time Warner. With all of these markets bundling together, it seems like there will be a better competition ground for companies to offer VoIP-based services, eventually benefiting both, the residential, and enterprise telecom market. I believe that Kagan is right on the money with its prediction about these cable operators having a better chance of providing better service bundles post-Adelphia’s acquisition and the cable industry’s notable act of "closing-in." Kagan Research www.kagan.com ----- Johanne Torres is contributing editor for TMCnet. To see more articles by Johanne Torres, please visit: http://www.tmcnet.com/tmcnet/columnists/columnist.aspx?id=100006&nm=Johanne% 20Torres [ Back To TMCnet.com's Homepage ]