British cable merger
The consolidation of European cable companies continues apace. This time it is two British companies; NTL Ltd. has announced it will buy rival Telewest Global. The deal is for around $6 billion. The combined company will become the #2 communications group in Britain, after BT Group.
The two companies are geographically separate. NTL operated mostly operates in the London area, eastern England, the Midlands, and Northern Ireland. The Telewest network is quite disjoint, but is more in the west and southeast of England, and some parts of Scotland. The combination will make for an extensive, more contiguous network.
Both of the firms are "triple play" companies, offering TV, broadband Internet, and telephone service. The new company will have 5 million cable TV subscribers, 2.5 million broadband users, and 4.5 phone customers. That figure makes it the biggest broadband company in the UK. NTL is the result of the combination of 20 local cable television operators.
Both companies are publicly held. One factor they have in common is that they were once owned in part by John Malone of Liberty Media/Liberty Global. Both also went bankrupt in 2002 and were re-organized and went public recently.
Telewest is separately in the process of auctioning off its Flextech TV production division to another company. NTL has announced it will review the auction and perhaps may keep the production arm.
It is typical of the competition matrix shift in the communications industry that the new NTL company will compete most with BT, the British telephone company; Cable & Wireless, which serve business customers in terms of internet access and phone services; and News Corp.'s BSkyB, a satellite pay TV service.
10:49:56 PM 
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