I just received my Spectrum invoice for the month. It was up 15% over last month. Last month it was up 10% over the month before. I called. The guy told me, yes, and it will increase another 15% next year.
However, if I were a new customer, I’d receive a 30% discount. I said, if I quit and come back, then I’d reduce my bill. But, I’d have to go 30 days without cable. I said, that must be why I’m seeing so many signs popping up all over my neighborhood proclaiming a switch from Spectrum to the only competitor in town.
The cable TV business is tough these days. Therefore, consolidation is not surprising. Spectrum (Century) acquired Time Warner Cable. So, they raise rates to pay for the acquisition. In the end, consolidation does not benefit the customer with lower costs.
Unfortunately for them, there is another alternative. I can keep the Internet cable connection, which isn’t bad, and drop the phone (who needs “land line” anymore anyway) and drop TV. Most of what we watch we can stream over Amazon Prime and Netflix. I just have to discover where to get my soccer fix.
The reason I relate this story involves treating it like a fable—a story with a moral.
I also see much consolidation in the controls and automation market. This is inevitable. It reveals the state of maturity of the market. I used to earn some money consulting with companies about potential acquisitions in industrial instrumentation, control, and automation. The deals have been done. I haven’t had an inquiry for a year.
Check out how ABB, Emerson, and Schneider Electric are all growing through acquisition becoming more viable all-around competitors to Siemens. Look at how the stock prices of Emerson and Rockwell Automation shot up last fall when Emerson was pursuing an acquisition. Rockwell’s board turned down the offer and both stocks dropped. But both stocks have been on quite a rise for the past few weeks. One wonders? That combination would really shake things up.
I have no inside knowledge, and I’m definitely not telling you to rush out and buy stock. However, for all of you who are customers, I’d keep my eyes open and contacts updated.