Oceanic Cable’s
owner set to
expand in isles

Time Warner says
it'll run almost all of Hawaii's
cable TV operations

By Rob Perez
Star-Bulletin

Time Warner Inc. today said it plans to substantially expand its cable television operations in Hawaii, striking a deal to acquire most of the systems it doesn't already own here.

The company said it has signed a letter of intent to take over TCI Communications Inc. systems in Hawaii Kai, Kau on the Big Island and on Maui, Molokai and Lanai.

If the deal goes through, Time Warner, which already owns Oahu's Oceanic Cable, the state's largest system, would control all of the state's cable TV market except on Kauai and Hickam Air Force Base on Oahu.

Time Warner's subscriber count locally would go from 292,000 to roughly 327,000.

The company also would acquire TCI systems in Ohio and New York. In return, TCI would get Time Warner's Portland, Ore., system and would expand or create new partnerships with Time Warner.

The tentative deal still is subject to signing definitive agreements, approvals of the respective company's boards and regulatory approvals, including the blessing of the state Department of Commerce and Consumer Affairs.

Time Warner spokesman Kit Beuret in Honolulu said the company doesn't foresee any obstacles to finalizing the deal, which could take a year or more.

Time Warner has been talking to TCI about acquiring its Hawaii systems for more than a year.

If approved, the deal will have no affect on rates or services of Time Warner's existing local customers, Beuret said.

It also could mean expanded or new services for TCI's roughly 35,000 customers, he said. "It's a real win for the consumers."

Beuret downplayed potential concerns about Time Warner controlling too much of Hawaii's cable television market, noting that the company is an industry leader in upgrading cable systems.

"If you had to pick any company to be owning your cable system, I think most people would agree they would want it to be Time Warner," he said.

State regulators and officials from TCI in Hawaii could not be reached immediately for comment this morning. But the state likely will hold public hearings to get comments about transferring ownership of the local systems.

The planned Hawaii acquisitions are part of a deal involving some 2 million customers nationally of the two cable giants.

The country's two largest cable operators said the moves will create operating efficiencies and allow each of the companies to reduce debt. TCI, the nation's largest cable operator, is pursuing a previously announced strategy of restructuring into regional units that can focus on local sales and customer service.

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Dow Jones News Service contributed to this report.