Charter fends off HBO's accusations that TWC merger will be bad for OTT

Charter Communications (NASDAQ: CHTR) took to the blogosphere and vigorously defended itself as a champion of OTT services following accusations made by HBO parent Time Warner Inc. that the MSO's proposed merger with Time Warner Cable (NYSE: TWC) and Bright House Networks would thwart online video competition.

"Charter wants programmers to offer their content OTT. We have invested millions of dollars building an infrastructure that enables and encourages our customers to watch video online or OTT," Charter said in a company blog post.

The missive came after Time Warner Inc. and HBO lawyers met with FCC officials last week and expressed their concerns about the deal.

If the mergers are approved, Time Warner said in an ex parte filing detailing these meetings, "a combined Charter-Time Warner Cable-Bright House will attempt to harm the continued development of over-the-top video broadband competition."

In its response, Charter noted, "While certain entities have alleged that Charter doesn't want programmers to make their content available OTT, the truth is that Charter has believed for several years now that OTT programming is great for our business.

The MSO referenced a 2014 quote from its President and CEO, Tom Rutledge: "I want over-the-top because it makes my broadband service valuable. I have a really good broadband product, and I can make it better with relatively easy capital investment, so the more people use it, the more value is [earned] by it."

Time Warner Inc. has been careful to position itself as not opposing the mergers per se, merely asking the FCC to place conditions on them.

"To be clear, we are excited about programmers like HBO who are starting to offer over-the-top versions of their content through products like HBO Now, simply because it makes our unlimited, high-speed broadband more valuable for consumers," Charter added. "It also benefits consumers by providing them more ways to access programming, which in turn places less pressure on service providers like Charter to give in to a programmer's demand for a sky-high rate increase."

For more:
- read this Charter blog post
- read this FCC filing from Time Warner Inc.
- read this Bloomberg story

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