Charter Communications has been flooding the mailboxes of its cable TV and internet subscribers in Maine with welcome letters that speak of exciting new services on the way following its recent purchase of Time Warner Cable.

But evidence suggests that Time Warner subscribers who expect a significant boost in customer satisfaction are likely to be disappointed.

In May, Stamford, Connecticut-based Charter Communications acquired Time Warner and another rival, Bright House Networks, for a combined $65.5 billion, creating the third-largest pay television company in the country behind Comcast and DirecTV.

Though the acquisition has been completed, Charter continues to operate Time Warner as a separate entity, telling Time Warner customers in Maine and elsewhere that there will be no immediate changes to their service. The letters to customers do contain some vague teaser language such as, “Exciting changes are in the works.”

Providers of cable TV and internet services regularly appear on lists of consumers’ least favorite companies, and Time Warner frequently was among the worst performers, along with rival Comcast.

The latest American Customer Satisfaction Index report on telecommunications companies, released this month, rated Time Warner the second-worst subscription TV service, with a customer satisfaction index score of 59, below Comcast (62), DISH Network (67) and DirecTV (68).

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But Charter didn’t do much better than Time Warner, according to the report. It received a customer satisfaction score of 60.

With regard to internet service, Time Warner performed better than Charter. Time Warner received a score of 66, to Charter’s 63. Both performed considerably better than Comcast, which received a 59 for its Xfinity internet service.

Phil Lindley, executive director of Maine’s ConnectME Authority, said the introduction of Charter and its Spectrum brand in Maine will not change the competitive landscape for cable TV and internet services in the state. It remains to be seen whether the acquisition will bring significant changes to customers who had Time Warner.

“It will be interesting to see what their products are, and what their prices are,” Lindley said.

HOPING FOR LOWER PRICES

When asked their opinions about the acquisition on the Portland Press Herald’s Facebook page, Mainers who responded expressed mixed feelings.

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“I’ve set my expectations pretty low, since they already rake you over the coals for pricing, and it only continues to go up year over year,” said Erin Nadeau of Kennebunk. “You’d think that long-term customers would be those they’d want to price a bit better, but alas, that isn’t the case.”

As of Wednesday, the websites for Charter and Time Warner were offering new customers comparable bundled TV, internet and digital phone service packages for a one-year-only introductory price of about $110 a month. Charter’s bundled package at that price included “175+” channels including HBO, Showtime and Cinemax. Time Warner’s package included “200+” channels, but did not specify whether any premium channels such as HBO were included.

Neither website explained how much the price would go up for those services after the introductory period.

A recent study by the Federal Communications Commission found that from 1995 to 2013, the average monthly price for “expanded basic” cable service nationwide nearly tripled, from $22.35 to $64.41, while the average number of channels offered nearly quadrupled, from 44 to 160.

Some Mainers don’t see the boost in channels as an improvement.

Portland resident Sharon Bearor posted on Facebook that she hopes the merger brings “lower costs for 200 channels I DO NOT WANT and more packages to choose a la carte (for) the 10 or 12 channels you DO watch.”

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“Tired of the costs,” she said. “Hope to see some positive changes for the consumers.”

Some who commented said market forces and the economics of operating a cable company make it unlikely that services would ever become cheaper in Maine.

“The market sets the price and here we are complaining about it,” said Robert Searle of Kennebunkport. “That’s why it costs what it does.”

Other comments expressed hope that Charter would increase download speeds for Maine customers. Last week, state officials in New York said Time Warner failed to deliver the internet speeds it advertised to customers. They sent a letter to Charter CEO Tom Rutledge demanding improvement.

When it comes to pricing, the Charter and Time Warner websites hide their regular, long-term pricing behind short-term, promotional packages that are qualified with footnotes and fine print. Charter’s marketing promises faster internet service than Time Warner (60 megabits per second versus “up to 50Mbps”), but Time Warner’s prices appear to be slightly lower.

Some consumer advocates say the merger creates a near-duopoly between Charter and Comcast, Maine’s other major cable TV and internet service provider, that could help the two cable giants push anti-competitive practices in the future.

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CUTTING THE CORD

The cable industry has been consolidating rapidly over the past decade, with local providers being folded into regional ones, and regional providers into national ones. Much of the consolidation is being driven by the high cost of rapidly advancing communications technology, which has made it much harder for smaller operators to compete.

“Time Warner has absorbed a number of other companies within this state,” ConnectME’s Lindley said.

At the same time technology costs are rising, a growing number of cable TV customers are “cutting the cord” and leaving traditional subscription video services behind for internet streaming services such as Netflix, Hulu and Amazon Prime.

In 2015, about 300,000 U.S. households canceled their cable TV service, and about 600,000 households dropped their satellite TV service, according to eMarketer senior analyst Paul Verna. He estimated that by 2020, 4.2 million more U.S. households will have done the same.

The fear of losing pay TV subscribers has pushed some cable operators, including Comcast, to impose limits on the amount of data internet customers can download each month without having to pay steep overage charges. Internet streaming services require the transfer of a lot of data.

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However, the Federal Communications Commission imposed restrictions on Charter’s acquisition that prohibit the company from implementing data caps for at least seven years. The FCC also prohibited Charter from engaging in certain other business practices that could hurt streaming video providers such as Netflix.

Still, some consumer advocates have complained that the FCC should have gone even further by also placing limits on how much Charter can raise its prices each year.

As far as former Time Warner workers in Maine are concerned, Lindley said there are bound to be some layoffs as a result of the merger, but most are likely to keep their jobs.

Because Charter and Time Warner are both large companies, the merger is likely to go a lot smoother than the acquisition of Verizon Communications’ network in Maine by the much smaller FairPoint Communications in 2008, he said.

“The FairPoint-Verizon merger was rampant with hiccups,” Lindley said. “I mean, FairPoint had to declare bankruptcy.”

One thing the acquisition of Time Warner won’t bring to Maine is increased competition, he said. The vast majority of Mainers still will have only one choice of cable operator in their neighborhood.

“It’s not going to create choice for anyone,” Lindley said. “You’re not going to have two cable lines running down the street.”


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