Liberty's Malone says deals needed in U.S. cable market
By Liana B. Baker
SUN VALLEY, Idaho (Reuters) - Liberty Media Corp chairman and cable pioneer John Malone, whose offer to buy Time Warner Cable Inc was rejected by its management, sees Time Warner Cable as a buyer of other cable operators in an industry that needs to be consolidated.
Cable companies need larger scale through consolidation, whether through mergers or joint ventures, the so-called "King of Cable" told reporters on the sidelines of the annual Allen and Co media conference in Sun Valley, Idaho.
Malone's Liberty Media, which has a 28 percent stake in cable operator Charter Communications, has been circling Time Warner Cable. Liberty also has a 1 percent investment in Time Warner Cable.
"(Time Warner Cable) should be a consolidator because they're the second biggest," he said.
Time Warner Cable, with roughly 12 million subscribers, is the No. 2 U.S. cable provider behind Comcast, which has more than 21 million video customers.
Since the 72-year-old Malone jumped back into the U.S. market with Liberty Media's investment in Charter earlier this year, analysts have predicted a wave of cable consolidation. The U.S. cable TV market faces rising programming costs as well as technology threats from upstarts such as Netflix, which offers movies and TV shows to subscribers online.
Malone recently made an offer for Time Warner Cable, which was rejected by its management because they believe it is not beneficial to shareholders, Reuters has reported.
When asked Thursday if he wants to buy Time Warner Cable, he answered only "that's a tough question." While Malone indicated Time Warner Cable could do its own deals, he left open the scenario that Charter could still buy the company. Continued...