• by Wayne Friedman , Staff Writer, 2 hours ago

With two major cable TV and telecommunications companies merging -- Charter and Cox -- look for some different worries from TV stations executives as those two companies combine their aging/existing video businesses.

Charter and Cox will now have around 14.1 million U.S. subscribers for their video operations, with cable or digital/internet access. Charter had around 12.5 million subscribers in June; Cox, 1.5 million at the end of 2025.

The combined company will be the largest in the U.S. when it comes to total pay TV distribution.

For sure, it gives the company additional leverage when it comes to TV stations, outlets that need the carriage from those distributors, and where they also get retransmission revenue from. But it also adds another wrinkle.

For years now, the focus -- at least from Wall Street -- hasn’t been on these two companies' video-cable operations. It’s all about broadband, home wireless, and mobile -- key businesses that support those video, pay TV bundling services.

As part of the merger, Cox Communications has officially merged into the Spectrum brand.

It’s all about connectivity, which has been the major revenue and profit growth driver for companies like Comcast, Charter, and Cox, among other mid-size and smaller players.

In recent periods, however, the broadband/mobile business has been crazily competitive with the bigger threats coming from AT&T, Verizon, T-Mobile, Consumer Cellular and other connectivity providers. And business growth has slowed dramatically for those original cable-centric operators.

So that isn’t good news. Owners of cable operations may not be truly focused on their video operations growth. Instead, they're reviving their now-core connectivity business growth. So the leverage is different.

“Cable operators are no longer reliable engines of indefinitely expanding retransmission revenue,” Tim Hanlon, founder/CEO of media consulting firm, Vertere Group, said recently.

He adds that this will cause other reactions. “If distributor resistance slows retrans growth while reverse compensation keeps rising [rising payments to networks for affiliation deals] friction between networks and affiliates becomes harder to absorb.

“That could encourage affiliation changes, portfolio reshuffling and still more station consolidation as broadcasters seek negotiating scale of their own.”

All this comes as TV stations continue to get battered around from digital media -- Meta, Google, and the like -- that targets local brands and users. 

And worse, a coalition of state Attorneys General and DirecTV are opposed to the $6.2 billion Nexstar-Tegna TV group deal saying the merger severely harms local market competition.

Currently there's a federal court injunction that strictly prohibits Nexstar from consolidating operations with Tegna.

So the deal for the time being is stuck. Are other TV stations groups feeling stuck as well?