Charter Communications has announced that it will buy Bright House Networks for $10.4 billion.

Bright House is the sixth biggest and serves approximately 2 million video customers in central Florida, as well as Alabama, Indiana, Michigan and California.

Connecticut-based Charter, which is currently the fourth-largest cable operator in the United States, said that it would become the second-largest cable operator after the deal. Shares of Charter jumped 7.5% to $197.18 in morning trading.

The pay-TV model struggled as consumers have turned away from more-traditional forms of pay television toward Internet-based entertainment services such as Netflix and Amazon Prime.

These services offer cheap services and might tempt cable subscribers who want to lower their bills by paying only for the networks they want. Jan Dawson, an analyst at Jackdaw Research, said, "The future of TV is going to be decided less by mergers between these players and more by evolution in the customer experience they provide".

On Tuesday's conference call, executives said that Charter could pursue other deals. After Bright House acquisition closes, the company will still be left with the capacity to borrow as much as $6 billion. With this capacity, the company could fund more purchases.

However, expanding might not be the solution in an industry that has shown signs of decline. According to research firm SNL Kagan, the number of US subscribers to cable, satellite or fiber services fell for a second straight year in 2014, by about 176,000. This is causing phone and cable companies to retain video customers rather than chasing them.

Dawson added that mergers won't be able to change the shape or nature of what consumers buy from them, fundamentally.

Meanwhile, Apple has planned to debut a service this year with about 25 channels. The largest US wireless carrier, Verizon Communications is also aiming at entering the Web-based streaming market with a slimmed-down package.