Newspaper article International New York Times

Comcast Adds to Grand Media Plan

Newspaper article International New York Times

Comcast Adds to Grand Media Plan

Article excerpt

With its proposed $45 billion takeover of Time Warner Cable, Comcast could cast a shadow over the media and telecommunications landscape.

CORRECTION APPENDED

Three weeks ago, Comcast announced plans to build an addition to its headquarters, a gleaming steel-and-glass tower designed by the architect Norman Foster that will cast a shadow over downtown Philadelphia.

With its proposed $45 billion takeover of Time Warner Cable, the company could do much the same over the media and telecommunications landscape.

The deal, announced on Thursday, solidifies Comcast's reputation as an enterprise with grand, even audacious, ambitions. Begun 51 years ago with just 1,200 subscribers in northern Mississippi, Comcast has grown into a giant conglomerate that now has one foot in the broadband and cable businesses and another in content, thanks to its ownership of NBCUniversal.

Its competitors now include companies as varied as Verizon in broadband and the Walt Disney Company in entertainment, and with a market value of $138 billion it is bigger than either, and more diverse.

"I don't know of a company that has the combination of assets that Comcast has," said John Doerr, the venture capitalist. "It's a well-integrated suite. That's where the world is headed."

The deal to acquire Time Warner Cable -- completed in just a week -- is certain to face scrutiny from the government and opposition from consumer groups. But if approved, it will make Comcast a national player, adding millions of subscribers in major markets like New York City, Dallas and Los Angeles.

Investors expressed some skepticism, sending Comcast shares down 4.1 percent in trading Thursday. Some think that Comcast may have overpaid in the deal. In addition, Comcast faces the challenge of successfully managing large, sometimes unwieldy components -- much as Time Warner did when it owned AOL, Time Warner Cable and an array of other assets.

But analysts generally praised the deal. Richard Greenfield, an analyst at BTIG who had predicted that Comcast would eventually arrive as a buyer, said the transaction would pay off in the long term. "It's too transformative a deal to pass up," Mr. Greenfield said. "It shows recognition of a rapidly changing landscape."

The move further establishes the reputation of Comcast's chief executive, Brian L. Roberts, as a daring deal maker with expansive ambitions. A soft-spoken 54-year-old, he lacks the outsize personality of an executive like Rupert Murdoch but has nevertheless become an influential mogul, with power centers in both Philadelphia and 30 Rockefeller Center, the New York home of NBCUniversal. His company reported $6.8 billion in profit on $64.7 billion in revenue last year.

Mr. Roberts, whose father, Ralph, founded the company in 1963, has deep roots in the cable industry. He spent some of his teenage years as an intern answering service calls and repairing cables. But over time, he developed what analysts and friends call a sharp mind and a killer instinct, unafraid to pursue high-priced takeovers.

"Fifteen years ago, a lot of cable entrepreneurs of my dad's generation began selling their companies and we wanted to buy," Mr. Roberts said by telephone. "We wanted to create a company that was sustainable."

Behind the approximately $100 billion in deals that he has overseen has been a belief that the company could compete across a variety of platforms with Verizon, AT&T and DirecTV. And he foresaw the importance of high-speed data early on, according to Mr. Doerr, who became friends with Mr. Roberts in the 1990s.

Mr. Roberts recalled that when Bill Gates invested $1 billion in his company in 1997, the Microsoft billionaire told him that data would be a bigger business than video one day.

"I didn't know what he was talking about then, but he was right," Mr. …

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