• by Wayne Friedman , Staff Writer, 5 hours ago

Two major Hollywood movie studios merging? Maybe it doesn’t end there.

What if two major legacy pay TV providers, Comcast and Charter -- the two biggest traditional cable TV operators -- go dancing together?

Why this deal? Two reasons: Video subscriptions, of course, which have been declining for nearly 15 years. And more importantly to some, helping to bolster a weakening and declining broadband business.

With a deal, those two companies -- which could amass 26 million video subscribers -- would mean a massive dominant player in the pay TV space.

From a video perspective, both Comcast and Charter continue to attempt to make inroads by adding related streaming platforms as a distribution business -- say, Paramount+, Peacock, Disney+ and Hulu.

The trouble is that this runs against the likes of Roku and Amazon Prime Video Channels, which have far too much market strength, and have gained a massive foothold on the streaming ecosystem.

With this reference point, looking broadly, in a merger this size -- amassing a significant but not dominant share of video households around 20% -- could mean antitrust concerns.

This is talk many consider would be unheard just a few years ago. But that’s how rapidly the market has been changing.

Analysts from New Street Research and JPMorgan have both recently argued that a merger makes it logical for both companies to look at a deal -- especially on the broadband focus of things.

In particular, they see fiber-optic providers and 5G "fixed wireless" internet providers from T-Mobile and Verizon Home Internet continuing to put pressure on both companies.

While mobile services are still climbing -- Comcast’s Xfinity Mobile and Charter’s Spectrum Mobile -- both are connected through a deal with Verizon. This could give a combined company more pricing leverage.

Both Comcast and Charter have already looked to these big changes.

Comcast Corp. has already spun off cable networks under new Versant Media -- CNBC, MS Now (formerly MSNBC), USA Network, SyFy). This leaves a core NBCUniversal remaining.

Charter is doing its own bit of looking for marketplace leverage -- with its soon-to-be-closed $34.5 billion deal to buy Cox Communications.

But this may not be enough. The massive, $111 billion Paramount Skydance/Warner Bros. Discovery deal could be sign of bigger communications and media changes to come.