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US regulators approve cable tie-up

BBC News BBC News 25/04/2016
Time Warner sign and van © Reuters Time Warner sign and van

The US Department of Justice (DoJ) has approved Charter Communications purchase of cable operators Time Warner Cable and Bright House networks.

The deal will create the second largest cable broadband provider in the US.

Charter had to agree to not stop its content providers from separately selling shows online, as part of the approval.

The deal also still needs approval from the Federal Communications Commission (FCC) before it can go ahead.

But the head of the FCC Tom Wheeler said he was seeking approval for the deal, noting the merger conditions "will directly benefit consumers by bringing and protecting competition to the video marketplace and increasing broadband deployment."

Stiff competition

The DoJ said it would work with other regulators to ensure the merger did not "choke off" access to online videos.

"The settlement forbids the merged company, referred to as "New Charter," from entering into or enforcing agreements that could make it more difficult for online video distributors (OVDs) to obtain video content from programmers," the DOJ added.

US cable companies are facing stiff competition from online service providers such as Netflix, Amazon and Hulu, as customers increasingly choose to stream films and television shows over the internet often for a lower price.

Charter will pay $78bn (£54bn) for Time Warner and $10.8bn for Bright House.

The combined three firms will serve cable television and broadband to 23.9 million customers in 41 states.

The deal was announced last year after Comcast abandoned its $45bn plan to buy Time Warner Cable fearing pressure from regulators.

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