Proposed Charter-Bright House Megamerger: Potential Channel ImpactProposed Charter-Bright House Megamerger: Potential Channel Impact
Andrew Pryfogle, senior vice president of cloud transformation for Intelisys, tells Channel Partners that consolidation in the cable industry is a positive development. Here's why.
April 2, 2015
By Josh Long
**Editor’s Note: Please click here for a recap of the biggest channel-impacting mergers in Q4 2014.**
The $10.4 billion deal is the latest megamerger that could affect channel partners who market communications services to millions of businesses on behalf of America’s cable companies. The 22-year-old Charter had 386,000 commercial customer relationships at the end of last year, and on a pro forma basis, 2014 commercial revenues rose more than 18 percent, to $993 million.
Justin Venech, a spokesman for Charter, said Thursday that it was premature to comment on the impact of the acquisition on channel partners. Charter hopes the deal closes at the end of this year or early in 2016.
Andrew Pryfogle, senior vice president of cloud transformation for Intelisys, a telecommunications master agency, is optimistic the merger will benefit the indirect sales channel. On behalf of cable companies, Intelisys largely sells high-speed Internet and high-capacity wide area networks to businesses, he said.
The master agency has relationships with Bright House Networks and Charter, Pryfogle said Thursday in a phone interview with Channel Partners.
“I’m a fan of consolidation in the cable sector for a couple reasons. We do a ton of business with all the cablecos right now,” said Pryfogle, who cited Intelisys’s relationships with cable companies as the fastest-growing component of its business for the last several years.
Petaluma, California-based Intelisys was founded in December 1994.
Intelisys is selling high-capacity fiber to customers, “and as the footprints consolidate, the actual reach of their [cable] networks get larger and we are now able to do bigger, more complex networks based on cable footprint,” he added.
Pryfogle also noted that Intelisys has contracts in place with its cable partners to protect the master agency in the event of a merger.
A similar sentiment comes from Vince Bradley, CEO of master agency WTG.
“The Charter-Bright House merger has a huge positive effect [on] the indirect channel,” Bradley told Channel Partners. “Charter’s established presence in the channel, coupled with its mature processes will be a welcomed “leg up” for Bright House to develop from Charter’s best practices. This new larger entity should be extremely successful through the combined Bright House and Charter footprints.”
Charter’s acquisition of Bright House Networks is contingent on …
… the Federal Communications Commission and U.S. Justice Department approving the $45.2 billion merger between America’s two largest cable companies, Comcast and Time Warner Cable – which is no sure bet.
Pryfogle said he is hopeful that the merger closes as well.
“The fact that Charter went ahead and made a bid for Bright House – a consolidation play that will move the combined companies up to the number two slot in the cable industry rankings – would seem to be a good sign that the industry’s two other big pending deals, Comcast/Time Warner Cable and AT&T/DirecTV, are likely headed for approval,” noted 451 Research principal analyst Rich Karpinski, commenting on a New York Times article that reported on Charter’s planned acquisition.
Provided Comcast and Time Warner Cable successfully merge, Charter plans to acquire 1.4 million Time Warner Cable subscribers. The deal would make Charter the second-largest cable operator with a base of 5.7 million commercial and residential customers. Stamford, Connecticut-based Charter would pick up another 2 million subscribers through its acquisition of Bright House Networks.
Bright House Networks, based in Syracuse, New York, has 135,000 business relationships, and its commercial revenues grew 19 percent last year, according to a Charter investor relations presentation.
Last year, Bright House Networks launched its channel partner program and announced that Converged Network Services Group (CNSG) was one of the first master agents to join it. As Channel Partners reported in April 2014, Intelisys joined the cableco as a partner as well.
Thanks to a Cisco deployment, Bright House jumped into the cloud and managed services world, offering products including hosted voice, security, call center, application and IaaS. The company also has provided managed security, network transport, Wi-Fi, and traditional voice and data to businesses.
Read more about:Agents
You May Also Like