Comcast has officially submitted its application to the FCC for the proposed 45 billion dollar purchase of Time Warner Cable. The combined company would cover nearly 33% of the nation’s cable customers and between 35-40% of the nation’s broadband customers, and be the dominant cable provider in nineteen of the top twenty markets.
The Senate Judiciary Committee held a hearing on Wednesday to examine the impact the merger would have on consumers. Comcast executive vice president David Cohen has been the face of the deal for Comcast, making claims that the merger will ultimately benefit consumers and that in this particular case, “big is very good.”
With essentially no significant U.S. competitors, the merger would provide Comcast with a captive audience of cable and internet consumers. This means ultimate control over pricing, internet speed, and T.V. network availability. And if you’ve ever had to deal with Comcast customer service, just imagine how long you’ll be on hold when they have twice the customers.
Gene Kimmelman, CEO of the non-profit group Public Knowledge, has said that the merger would turn Comcast into a “national octopus,” and stifle competition in the cable and internet market. Says Kimmelman:
“When you start to peel the onion, you actually find very few competitive options.”
Think back just to 2011, when Comcast acquired a majority stake in NBC Universal, and then gained full control in 2013 when it bought the remaining 49%. Senator Franken was opposed to Comcast’s acquisition then, and has been equally outspoken against the merger today. Says Franken:
“Comcast never again will have to negotiate with Time Warner Cable when it comes to setting prices for NBC content. And NBC content, everyone should remember, is 20-some networks.”
Essentially, Comcast would be able to extract unconstrained fees from its subscribers and charge higher prices to smaller cable companies that want to air high-demand NBC content, like the Olympics.
All of this is all apart of Comcast’s effort to scale up and compete with international corporations like Google, Apple, and Verizon Wireless.
But Comcast is not Google, not even close. Google is a multinational corporation that arguably created the Internet as we know it today. Comcast is the inadequate cable provider that continues to grow despite consumers dissatisfaction. If Comcast wants to be respected international company, they’re going to have to do a lot more than buy out another failing cable company.
In the end, the FCC and Department of Justice will be the decision makers. Hopefully they’ll be able to see that this deal is good for the shareholders, not the customers.