Comcast: Allowing Us To Get Immensely, Inconceivably, Ridiculously Massive Is 'Pro Consumer'

from the now-witness-the-fire-power-of-this-fully-armed-and-operational-battle-station dept

Comcast has confirmed reports that the company will be acquiring Time Warner Cable in a deal estimated to be worth around $45 billion. With the ink on their NBC acquisition only just dry to the touch, the deal will tack 8 million broadband subscribers onto the company’s existing 22 million broadband customers. Comcast is already the nation’s largest fixed-line broadband company, largest cable TV provider, and third largest fixed-line phone company — and that’s before you include the company’s NBC or other assets. From a geographical perspective the deal makes sense; Time Warner Cable filling in Comcast’s coverage gaps and in particular giving Comcast the prized markets of Los Angeles and New York City, where Time Warner Cable has traditionally under-performed.

The problem is less of market share (the two companies didn’t compete directly) but one of consolidated power; allowing one, massive company to control both the content and the conduit to your home across the vast majority of the country — then just hoping they’ll play nice with smaller competitors, startups and consumers. Never worry, insists Comcast, who states that they’ll divest a few of these markets (most likely to failed Time Warner Cable suitor Charter Communications) so that they won’t be quite as absurdly massive as they might have been.

In a memo (pdf) paving the way for what’s sure to be a tough attempt at regulatory approval, Comcast’s David Cohen trots out Google Fiber as an ambiguous example of why vertical integration and market dominance concerns no longer apply:

“In today’s market, with national telephone and satellite competitors growing substantially, with Google having launched its 1 GB Google Fiber offering in a number of markets across the country, and consumers having more choice of pay TV providers than ever before, Comcast believes that there can be no justification for denying the company the additional scale that will help it compete more effectively.”

Except, well, not. Google Fiber is only available in two actually-deployed markets currently, and despite being a great price-disruptive product in those locations, likely won’t be expanding beyond more than a handful of cities. As for “growing” national telephone competitors, both AT&T and Verizon are in the process of gutting regulations across dozens of states so they can begin hanging up on unwanted DSL and phone customers they don’t want to upgrade. They’re effectively ceding all competition on the fixed-line front in half of their markets so they can focus on wireless, signing co-marketing deals with cable directing those users to what will be their last fixed-line choice for broadband.

That choice is going to be Comcast, and with less competition than ever across huge swaths of the United States, you can be certain the company will be bringing their planned usage caps to your neck of the woods before long — impacting consumers, startups and small businesses across the country. Again, no sweat argues Comcast. In a “public interest benefit summary,” (pdf) Comcast again states you don’t have to worry about any of this, because, well, Google Fiber and Netflix. Or something like that:

“A number of online businesses like Apple, Google, Amazon, Hulu, Netflix, and a host of smaller companies are entering the online video space and trying to position themselves as competitors. While we view online businesses as complementary to our business, previous antitrust concerns about further cable consolidation are truly antiquated in light of today’s marketplace realities.”

Right, because there’s no way that a massive company like Comcast with that kind of lobbying power and market leverage could find it easier than ever to squeeze these companies through restrictive content licensing deals, regulatory capture, or usage caps, right? And oh, just a reminder Comcast, you own Hulu, and alongside other broadcast owners have worked hard to ensure it never disrupts the legacy TV apple cart. All in all, Comcast would prefer you not worry your pretty little head about any of this stuff as we wait to see whether new FCC boss Tom Wheeler (formerly a lobbyist for the cable industry) approves Comcast’s latest adorable growth spurt.

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Companies: comcast, time warner cable

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Comments on “Comcast: Allowing Us To Get Immensely, Inconceivably, Ridiculously Massive Is 'Pro Consumer'”

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Anonymous Coward says:

Maybe this isn't such a bad thing?

Hear me out. Right now, Comcast is both too large and too powerful, yet not so much so, that they’re in risk of being broken up or regulated in any way. They get large enough, and then maybe they can get Ma Bell’d, or at the very least, be told they need to beef up their infrastructure or be fined for monopolistic practices.

Of course, that would involve leadership in this country who actually gives a crap about the people and what we want.

Anonymous Coward says:

Re: Maybe this isn't such a bad thing?

I could see that happening but it really needs to be done differently than the AT&T breakup was done. You can’t simply divide the country up and give a monopoly for service to a different company in each market like they did with local phone service. What needs to happen is something more like the deregulation of electric utility service. Comcast could be allowed to maintain the infrastructure, but would be barred from selling service direct to customers. Instead other companies would be able to resell the service over Comcast’s network in much the same way as different electrical providers resell the same electricity over the same lines. That would ensure competition in the market from various companies providing the service.

Anonymous Coward says:

Re: Re: Maybe this isn't such a bad thing?

Also that can take a long time. The initial case by the DOJ that led to the breakup was filed in 1974 and dragged on until it was finally settled in 1982 with the breakup not happening until 1984. That’s 10 years for the entire process to happen and could have been even longer had AT&T kept fighting and not decided to settle the case. Still I see the possibility of it happening. Big monopolies only get broken up when they abuse that monopoly power and enough people get fed up with the abuse and complain to the point where the government decides to step in. Comcast has demonstrated repeatedly demonstrated the willingness to try to squeeze every ounce of revenue out of their customers that they can and abuse their position in very anti-competitive ways. This is exactly the path AT&T was taking that led to their breakup even though it took a long time to happen.

PRMan (profile) says:

Re: Maybe this isn't such a bad thing?

There’s no way for the sheep to hear another voice over the shouts of the media. Ron Paul didn’t play nice with them and even when he won debates, his name was missing from almost all the articles. They said, “Mitt Romney was second and Michelle Bauchmann was third.” They conveniently left Ron Paul out of the entire article.

RoKphish (profile) says: Petition

There is no way in hell this is this merger can conceivably be in the public interest.

For what it’s worth … a petition to Stop the Comcast/TimeWarner Cable merger and require more competition in the cable industry

Karl Bode (profile) says:

Re: Re:

Technically it is two, just not very many people in those two places (which was the point). Kansas City (both in Kansas City, Kansas and Kansas City, Missouri), and Provo, Utah, where new residents can’t sign up for service, but people there on the old Veracity FTTH network are already connected because there were no new lines needed to run.

zip says:

Since former FCC Commissioner Meredith Baker went from approving the Comcast-NBC merger to becoming an employee of Comcast-NBC in a span of only a few weeks, the big question now is what other federal officials are being courted this time around with the usual offer of a high-paying “private sector” job in return for rubber-stamping this latest Comcast merger?

We should take a poll: Who will be the next government official -supposedly regulating Comcast- to accept a job offer from Comcast?

zip says:

Re: Re: revolving door should be harnessed as renewable energy

But at least FCC boss Michael Powell spent a few years bouncing around the Washington think-tank circuit between his job as top cable industry regulator and his job as top cable industry lobbyist (where we all knew he would eventually end up).

FCC’s Meredith Baker hopped beds so fast that it was pretty obvious she must have been negotiating for her new job (at the mega-corporation she was helping create) at the same time as they were negotiating for her approval of the merger. A “package-deal” in which all sides benefited — except the public, of course.

Anonymous Coward says:

About seven years ago, I lived on a military post where Comcast had an exclusive deal to provide internet to housing. When contacting their support, I was told if I was unhappy with their service, the representative told me that I could always move if I was unhappy with them providing less than 56kbps every night while paying for a 20MB package.

I think I had better start saving so I can afford the move to Kansas City.

Anonymous Coward says:

Frankly the only way I can see ‘true’ competiton emerging is if our state and local governments buy out the infrastructure from the telcos

The telcos can then compete against one another for providing individuals with hardware hookups to the network. Although at that point honestly I might just be OK with having the telcos replaced with a state level agency

Anonymous Coward says:

Re: local governments buy out the infrastructure from the telcos

The government would not even need to buy-out the infrastructure — just force the company to accept tie-ins from other service providers. That’s basically what was done decades ago to force local telephone monopolies to offer customers the choice of long-distance service from non-AT$T providers such as Sprint.

Internet service could be handled similarly: one company to provide local service and infrastructure, another company to tie-into that local network and work outward.

Anonymous Coward says:

Re: Re: local governments buy out the infrastructure from the telcos

Where you really need the competition is at the local level. You have to have the situation where consumers have a choice of companies that are in competition even if they are selling service on the same infrastructure. With phone service in the wake of the AT&T breakup, this happened with the long distance service but not the local service. It needs to happen with the local service too.

Anonymous Coward says:

We’re soo screwed once the net neutrality restricts, imposed on Comcast by the FCC during the NBC merger, expire in 2018. Once it expires, a whole new market of “data cap limited” service plans and increased prices are a sure thing.

Why eat up bandwidth streaming Netflix, and pay for higher tier “data cap limits”, when streaming Comcast On Demand content doesn’t count against your “data cap limit”.

Sound familiar Verizon? You wankers!

BSD32x (profile) says:

Re: Its Official

Just pucking up on that, I live in rural Ohio and the only highspeed I have access to is 2.5 mpbs Time Warner cable Internet (there is no DSL provider). The only competition in any sense is Exxede, which is satellite based Internet, but can actually hit speeds higher than TWC (I have a relative who switched). This issue with it is data caps, but here is what is ironic: they take the cap off from midnight to 5 a.m. when traffic is low, BECAUSE THE CAP REALLY EXISTS TO PRESERVE SPEED AND BREAK UP TRAFFIC. I am already paying $49.95 a month for my crappy 2.5 mbps from Time Warner, if Comcast implements a cap it will actually be more cost effective for me to go with Exxede and just do all of my downloading/streaming at night since I work 2nd shift anyway. That satellite Internet could be a better value for money in this day and age is just pathetic.

Wally (profile) says:

Disturbing on multiple levels..

from the now-witness-the-fire-power-of-this-fully-armed-and-operational-battle-station dept

The weakness to ComCast will be a 2 meter wide exhaust port…which happens to be no larger than a wamp rat…

The merger with TimeWarner was a matter of time when TimeWarner decided to buy out most of Northern Ohio’s ComCast contracts..what was left over was given to Cox…What this means is that it’s certified proof of an illegal form of an Ologopoly between the two companies….I’ll be willing to bet that the 2 meter exhaust port we are looking for is in the e-mails between the two companies during that time.

ColinCowpat (profile) says:

Come in Susan Crawford

Her book “Captive Audience” is a good read. I guess the FCC and DOJ need to apply a number of preconditions without end dates to cover the potential areas ripe for abuse, namely:

* Net Neutrality both in the network and to its edges
* investment in increasing speeds of the core infrastructure
* Separating out the current vertical integration between content & wires
* putting catastrophic penalties in place for violations of the above, or in support of legislation to undermine competitors and municipal alternatives

Somehow, I don’t think the FCC or DOJ are smart enough to go close. About the best result is to decline to merger, or put a precondition to spin out the infrastructure and content sides to separate trading entities…

limbodog (profile) says:

A long time ago, they passed a law preventing movie studios from owning theaters as it was unfair; movie theaters were essentially the only place to see art of this nature, and studios could (and did) limit shows to films they produced.

I’ve been thinking that law is obsolete for some time, but perhaps it really just needs to be expanded to include ISPs. Perhaps it should be illegal to be a content provider and an internet service provider, as companies cannot be trusted to treat other content providers fairly.,_Inc.

Namel3ss (profile) says:

Who are we kidding?

If this goes through it will be an UNMITIGATED DISASTER for the consumer. There’s not enough competition in ISP land as it is, and with this there would be even less.

If the ATT/T-Mobile merger didn’t go through, how the f**k could this possibly get approved? It’s 2x the ATT/TMO deal ($45B vs. I think $23B).

Maybe Com-ass-t gets better hookers for their FCC flunkies than ATT did. God forbid this actually gets approved.

RK (profile) says:

Here's a deal for Comcast...

I’m okay with the TW merger the day they open the local coax networks to leasing by competing Internet access companies, like the phone companies were forced to do with DSL over the public phone system.

Let me buy access to Netflix from “Bob’s Hometown Cable Internet” company, and Comcast can suck up all the old TV companies it wants.

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