It’s being called one of the most significant deals in telecommunications history, and analysts are already saying that television will never be the same again.
But the announcement that Charter Communications was buying Time Warner Cable for $55.3 billion U.S. will have implications well beyond traditional television. The deal has significant implications for the voice over industry, as well.
The “Why” of the Deal
Owning a cable or satellite television distribution business was once the key to a lucrative future. With few other options for home entertainment, consumers were for decades perfectly happy to sign up for increasingly complex bundles and packages that kept their TVs filled with new content.
The growth of Internet-based distribution and the spread of affordable broadband service has opened up the market as never before. Consumers now have access to a growing range of alternative online and mobile services. On-demand consumption – any device, anywhere, anytime – is taking over from the once-dominant model of subscribing to a set number of channels for a fixed monthly rate.
With TV watchers increasingly cutting the cable/satellite chord and going online for their fix, traditional cable companies find themselves grappling with an increasingly complex market of spiralling costs for content, and growing competition from over-the-top players like Netflix and Hulu. As speculation grows over the impending entry of Apple into this fast-changing space, the old ways of distributing – and getting customers to pay for – televised content are undergoing radical and irreversible change. Traditional cable bundles are disappearing – you can now subscribe to HBO without having to pay for cable, and you can even subscribe to TV channels on your Sony PlayStation 4 game console – so companies like Charter are increasingly willing to dive in head-first as they aggressively reposition themselves for whatever comes next. Standing still is not an option.
Within this context, Charter’s mega-offer for Time Warner stacks up as a bold bid to create a consolidated TV and Internet giant that keeps consumers buying, even if they’ve already cut the chord.
If this seems familiar, that’s because it is: Barely a month ago, Comcast, the largest U.S. cable operator, walked away from a $45.2 billion bid for Time Warner Cable, the No. 2 cable company. American regulators were concerned the combined Comcast-Time Warner organization would exert a monopolistic influence over the telecommunications industry.
Getting bigger is one way to deal with those changes. It gives cable providers access to more – and more lucrative – Internet subscribers and more leverage when it comes time to negotiating for new content.
Implications for Voice, Too
This is where the voice industry will want to stand up and take notice, as a deal this large will have some degree of longer-term impact on the space. The proposed acquisition will continue the trend in the industry where distributors, Internet service providers and content creators and owners find themselves working under the same corporate umbrella. The increased level of consolidation amid more concentrated ownership structures results in more projects being created and completed by relatively fewer players.
As a result, decision-making power tends to be concentrated somewhat in the hands of a smaller core of ultimately more powerful individuals and organizations. Voice talent will need to focus their efforts – for networking, branding and auditioning – on this smaller group of producers. At the same time, content creators will likely have to adjust the way they work within this more insular environment to pitch their ideas and obtain financing and studio support.
Read the full report here.