“A Verizon-Charter combo would yield a powerful footprint and a diversified content, advertising, mobile and MVPD platform to create new (ad-supported) offers viewers and subscribers,” said Rick Ducey, managing director of BIA/Kelsey’s consulting practice.
“That kind of cross-platform scale with lots of customer data opens up some very interesting scenarios.”
A merger could also spark new revenue opportunities for Verizon as the market for wireless services peaks, Ducey predicted. That strategy would be in line with why Verizon acquired AOL and is looking to acquire Yahoo.
“Ad tech and content are avenues where they can continue to build audiences and get to more scale in impressions to monetize,” Ducey said.
And speaking of ad tech, Verizon foreseeably would gain access to Charter’s addressable TV ad division, Spectrum Reach, which houses the former Time Warner Cable Media business and its creative TV agency, Kernel.
But addressability notwithstanding, Verizon’s flirtation with Charter shows that when it comes to content delivery and telco services, “scale still wins,” said Dave Morgan, CEO of Simulmedia.
“If the hope is to compete with AT&T as well as Google and Facebook in the ad business, buying Charter is table stakes for the scale to play at that table," Morgan noted.