Corporate Sunset

If you bear with me, I’d like to discuss cable providers with you for a second. Yeah, yeah, I know, not the most exciting thing. These are not well-loved companies.

And yet, I feel a bit of a way about the loss of one of the legacy cable television providers, Cox Communications, in the midst of a massive merger. It was the oldest of the massive original providers still standing, having beaten Comcast to the cable game by about a year. (Adelphia was born earlier, but it died in a blaze of embarrassment.) And it’s being more or less written over by Charter Communications, whose Spectrum brand name is being used in former Cox markets starting this week.

(Cox is still technically a subsidiary of Charter, but let’s be honest: How long will this arrangement really last?)

Cox, which was formed as an offshoot of the still-existing media empire Cox Enterprises, survived nearly 65 years, making an imprint on millions of lives in ways good and bad. Would the cable box crap out sometimes? Yes. Would the internet stutter? Absolutely. But this company, for many, was their first introduction to television beyond what a pair of rabbit ears could pull up.

(Plus, it took on a notable legal battle around digital piracy, helping to set some precedent at the Supreme Court earlier this year.)

Just imagine the number of people who were introduced to cable television with a pitch like this. There must be a lot of HBO beach towels out there.

It was the company that brought you your first glimpse of HBO and MTV, the company that put 800 channels into your entertainment system, the company that installed your first internet connection that you could actually use without hogging the family phone line. Yes, having to deal with a technician was a pain in the ass, and nobody liked paying for those giant bills. But Cox’s service was genuinely a game-changer for many.

And yet, mergers show how fragile longstanding relationships with public utilities really are. I grew up only knowing the local phone company as a Baby Bell, only for that company, Ameritech, to disappear into the gullet of another Baby Bell, SBC. I’m sure the streamlining made a lot of sense when it happened, but on the other hand, it is (for better or for worse) a break of the consumer covenant.

Sometimes brands just don’t hold up very well. I don’t think CableVision really was a particularly good name by 2016, when it was retired after a merger and everyone was watching stuff on Netflix. But Cox? Three letters, memorable. Certainly moreso than Spectrum or whatever.

For its part Charter is trying to put its best foot forward, as stated in this press release:

To welcome its new customers, Spectrum is offering a free year of mobile service to Cox internet customers who don’t already subscribe to Cox Mobile; the first of many benefits Spectrum will offer. In mid-September, Spectrum plans to launch its entire suite of products to all consumers, including existing customers, in former Cox markets offering Spectrum’s simple and transparent pricing and packaging, greater value and more opportunities to save.

Spectrum Internet and Spectrum Mobile work together over the Spectrum Fiber Broadband Network and are supported by approximately 45 million WiFi access points across the country, delivering a faster, more seamless experience than standalone 5G. Spectrum’s Seamless Connectivity bundle delivers the most reliable service and helps customers save with Spectrum’s $1,000 savings guarantee.

But why is this even necessary? Why not just stick with Cox in these regions, while leaving Spectrum under the hood? Cost savings is likely the main factor here. Charter CFO Jessica Fischer, who is departing to Citi next month, said during a recent presentation that merging the two companies could lead to a billion in synergies.

““The confidence that we have in the synergies that will come from the transaction, I’d say, has increased dramatically as we’ve sort of dug in further. And so we’ve raised our synergy target to more than $1 billion,” she said, according to Fierce Network.

But synergy ignores the dilution of brand value, which is particularly acute when the brand being retired has a lot of it.

Because I was curious, I looked on YouGov, which has a public-sentiment tracker for various brands, and found that Cox is actually a more-famous brand than Charter, but not more than Spectrum. But this mark doesn’t account for the fact that cable is a strongly regional play. That Cox has a 63% fame level when it only serves 20 of the 50 states (notably missing some biggies like New York, Illinois, and Pennsylvania) likely means its fame is probably much higher in the regions where it served.

I’m not even a Cox subscriber. I just think it sucks to get rid of such a legacy name brand.

All of this raises the question: Why not just keep this brand around? It’s not hurting anyone, and giving up so much brand equity for the sake of “corporate synergy,” whatever that means, just feels weird and dumb. It wasn’t an out-of-step brand. There were no weird scandals. It was just easier for its merger partner to present a unified marketing front to the public. Cox, based on various reports, had 6.2 million subscribers, which made it the third-largest cable company, though satellite and digital-only providers like YouTube TV complicate that picture somewhat. It’s smaller than Charter, but still a massive provider all its own.

I’ll fully concede that there are times that a brand should retire, that it as served its usefulness. I’ve always disliked the fact that GameStop essentially erased the FuncoLand brand name but one might argue that GameStop was better set up for where the industry was going. But GameStop doesn’t exactly have the most-appreciated reputation with gamers, while people look fondly on FuncoLand. If GameStop brought FuncoLand back in some way, it might be received warmly.

And there are cases in which subsuming a brand can harm the brand it replaced. Much hay has been made about Boeing’s decline in quality since it acquired McDonnell Douglas nearly 30 years ago. The reason, as any history of Boeing’s 737 Max crisis makes clear, is that the McDonnell Douglas guys ended up taking over the leadership of Boeing and instilling its philosophy across the brand. So McDonnell Douglas’ mediocre reputation became Boeing’s.

By keeping the brands separate, it slows the transfer of negative brand equity to customers that are used to working with another company, even if, under the hood, there might be two separate things going on. Inevitably, Spectrum is setting itself up for years of “it’s not as good as it used to be” complaints from its subscriber base.

I think the argument is quite strong that when a company has such strong brand value with its customer base that, merger or not, you should go out of your way to keep it around, and not in a “we slapped a Memorex logo on it” way.

Cox is a hugely popular brand that has been associated with numerous communities for people’s entire lives and they’re just killing it off to save some money. Make it make sense.

Nonsensical Links

The mess at Automattic got messier after we wrote about it last week. To give you an idea: Matt Mullenweg got his CEO role back, the leadership that voted him out got fired, and apparently the people behind his ouster gave themselves giant golden parachutes in case Mullenweg returned. Something tells me he didn’t use his time away thoughtfully.

Speaking of follow-ups, the situation with iLands drew a lot more attention after we wrote about it, with thoughtful takes from Ars Technica and 404 Media, among other outlets. Oh, and iLands dropped an unsubscribe link, while not exactly explaining why they let their bots run buck-wild over the internet over the weekend.

Drunk History is a show that should have never been cancelled, and yet it was. There are many things I don’t like about the current Paramount, but the person who came to their senses and gave Derek Waters a budget to make this show again deserves plaudits.

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