The Charter-Cox deal looks like expansion, but smells like retreat

When two telecom giants merge, the story is usually about dominance. This time, it’s about retreat. Charter isn’t building an empire with Cox. It’s patching holes.

We spoke with Andy Abramson, CEO and Founder of Comunicano, Inc., a communications firm specializing in telecom and tech exits. Abramson sees the Charter and Cox merger not as a sign of strength, but as a defensive move against a market eroding from all sides.

Telecom ouroboros: For Abramson, the industry’s power dynamics have simply come full circle. “The cable company has become the modern-day telco. What’s old is new again,” he says. “Just like cable took business from the telcos, fiber is now going to take business from cable.” In his view, the disruptors have simply changed uniforms.

Legacy lemon: Fierce competition drove the sale. Threats are coming from every direction: overbuilders like Google and AT&T are offering faster, cheaper fiber; Verizon and T-Mobile are gaining traction with fixed wireless; and satellite players like Starlink are expanding fast in underserved areas. “With all of this new competition coming, it’s like buying an old car that’s not even a classic. It’s like buying a ’66 Chevy Impala. Who cares?” Abramson says. “You’re basically buying a product that everybody needs, that everybody has, but long term you’re going to see market erosion.”

The long goodbye: This deal is not a sudden reaction. It is the final step in a years-long retreat. “Cox has been shedding assets for the last 15 years,” Abramson says, pointing to their sell-off of wireless spectrum in 2011, fiber assets to Ziply in 2023, and even shuttering units like Cox Edge. “Remember, Cox is a family office. It’s not a public company answering to shareholders. So when someone offers them a premium for a declining asset—and a continued stake—they take the money and walk,” explains Abramson. “I would have done it too.”

Race to the bottom: If it is a bad long-term buy, why is Charter going for it? Abramson sees it as a short-term survival play. “They are looking to show their numbers,” he says. “Because Cox is in more growth communities, this deal helps them offset churn and quietly bury their losses.”

He recalls being offered free cable TV just to stay on a broadband plan, a ploy to preserve subscriber counts and keep Wall Street at bay. “It’s a race to the bottom,” Abramson says. “Eventually, the current management will be gone and it will become somebody else’s problem.”