Malone: Cable needs own Netflix
October 11, 2013
By Chris Forrester
John Malone told Liberty Media Corp’s annual investor conference that cable companies should team up to create a rival to Netflix that would deliver programming over the Internet on a national basis.
Cable-cos could “solve the problem” of high programming costs by acquiring content for an Internet-based service under one brand that they would sell in a bundle with broadband, Malone said. He used the example of Comcast Corp’s Xfinity video streaming product one day being shared with the rest of the cable industry to become a national brand.
Malone has once again proved that he is the “cable guy” saying October 10th that there’s plenty of scope for more consolidation amongst cable MSOs. He argued that only by consolidation could cost-reductions and efficiencies be truly met. He said that Liberty would maintain its size and position and could help fund further deals within the sector.
“When you look at the Charter [merger] opportunity, it’s going to require incremental capital to pursue,” Malone said. “It’s best not to get Liberty too small too soon so we can have the capital to chase a few more rabbits.”
Liberty is a 27 per cent shareholder in Charter Communications, which is looking to merge with Time-Warner Cable, although Charter’s marriage proposal may be rebuffed. However, Malone’s comments were enough to see cable stock-prices rocket during the day (Charter up 3.5 per cent, T-W up an impressive 6.1 per cent).