Yesterday’s announcement of Comcast/NBCU buying Time Warner Cable was a monumental announcement as it consolidates more of the cable portion of the Multiple Video Programming Delivery services (MVPDs) that includes mostly cable and satellite delivery services. Instead of Charter moving up the list of cable MSOs, Comcast will now be clearly number one if the deal is approved by government officials.

The implications of this acquisition are significant. First. it will allow the merged company to compete more effectively with its increasing number of competitors. In addition to the satellite delivered services (DISH and Direct TV), nontraditional services such as Hulu and Netflix are becoming more competitive “Over the Top” video programming options to subscribing to local cable systems as sources for video programming. Poignantly on the same day as this deal is announced, Netflix announced that they have obtained the rights to a Star Wars animated series.

Second, dealing with the video programming providers (both cable-satellite delivered networks and local television broadcasters) will also be affected as Comcast/NBCU owns several in both categories. Negotiations between the newly merged company and those providers not vertically integrated will be more involved and possibly leading to lower prices (or smaller increases in those prices over time).

Finally, while the cable systems of the newly merged company do not overlap, the combination of these two companies should make them more formidable in the local advertising marketplace. Already, local cable systems are becoming stronger competitors in the local advertising marketplace.

Nationally, BIA/Kelsey estimates that local cable systems have 5.3 percent of the local advertising revenues growing to 5.8 percent by 2017, growing by nearly $1.8 billion. Comcast already is very aggressive in developing local cable advertising, see Comcast Spotlight. Certainly, when dealing with national advertisers, the newly formed company can offer a wider reach than before. National advertisers focusing more on local media markets is an important trend for all local media to consider and will be explored in detail at the upcoming BIA/Kelsey conference, Leading in Local: the National Impact.

While all of these improvements to the newly merged company could occur, the proposed acquisition will face significant scrutiny in Washington. Concerns about too much concentration in program delivery and its impact on negotiations with program suppliers will be front and center when the FCC and Department of Justice looks at this deal.