One thing is certain about Comcast’s proposed $45 billion merger with Time Warner Cable: It doesn’t pass the smell test. Comcast claims that the combination of the two largest cable companies will somehow enhance, rather than diminish, competition and lead to greater consumer satisfaction. Don’t worry, Godzilla will play nice on the playground.
The resulting company would have at least 30 million cable customers, slightly less than 30 percent of the TV market and 38 percent of the nation’s high-speed Internet customers. It would have virtual monopoly cable control over news and public service programming in cities including Chicago, Los Angeles, Philadelphia, New York City and the District. It would be able to exact price concessions from content providers, forcing some out of business, limiting innovation and variety. With “net neutrality” rules now under assault, it would be positioned to charge discriminatory rates for high-speed Internet access or to discriminate against Netflix and other companies seeking to stream online entertainment over its cable. And Comcast would be in the position to decide what gets priority access and what viewers across much of the nation won’t see.
Comcast is just digesting its previous mega-merger, the takeover of NBC Universal that should have been blocked by the Federal Communications Commission (FCC). That left Comcast controlling an empire that includes NBC, CNBC, MSNBC, USA Network, Telemundo and other networks.
Here the merger doesn’t just affect the marketplace of cable; it threatens the marketplace of ideas. The protection of free speech under our Constitution depends on citizens having access to many ideas, many sources, many ways of getting ideas and information. Letting mega-corporations consolidate control of key parts of the media infrastructure directly threatens that access.
In addition, consumers surely would get fleeced if the merger goes through. The United States already suffers from worse Internet service, speed and affordability than other developed countries. As Craig Aaron, president of the consumer advocacy group Free Press, summarized: “No one woke up this morning wishing their cable company was bigger. This deal would be the cable guy on steroids — pumped up, unstoppable and grasping for your wallet.”
Comcast is infamous for its lousy customer service. It ranks down with BP, AIG and Bank of America among the 10 least reputable companies in the United States, according to Harris Interactive’s annual “Reputation Quotient” survey. In the American Consumer Satisfaction Index, Comcast had the fourth-worst rating in the country.
On its face, this is a preposterous merger. Former FCC commissioner Mike Copps is precisely right when he says of the takeover: “This is so over the top that it ought to be dead on arrival at the FCC.”
Yet don’t discount what may be Comcast’s greatest strength. Its wireless service is slow; its cable service lousy. But Comcast is wired politically. Its chief executive, Brian Roberts, has golfed with President Barack Obama on Martha’s Vineyard. Its chief lobbyist, David Cohen,raised $1.2 million for the president in a Philadelphia fundraiser in 2011.
And Comcast is a poster child for Washington’s corrupting revolving door. One of its lead lobbyists — officially the senior vice president for government affairs of its subsidiary NBC Universal — is Meredith Attwell Baker. Appointed by Obama to hold a Republican seat on the FCC, she voted to approve Comcast’s takeover of NBC and then joined the newly merged company a mere four months later, after serving only two years of her five-year term.
The door revolves the other way, too. William Baer, who recently became head of the Justice Department’s Antitrust Division, represented General Electric and NBC Universal in their deal with Comcast. Maureen Ohlhausen, one of four sitting commissioners on the Federal Trade Commission, which is charged with enforcing antitrust laws, provided legal counsel to Comcast before assuming her post.
So blocking the merger, which should be a no-brainer, will require arousing the public to oppose it. Consumer groups and media watchdogs, as well as progressive groups, are mobilizing to do so. Seattle Mayor Ed Murray has announced his opposition and vowed to review the city’s franchise agreement with Comcast. Other mayors should follow his example. Sen. Al Franken, D-Minn., who has been a stalwart guardian of free speech, has raised objections in a letter to the FCC and the Justice Department.
The United States already has suffered the ravages of “too big to fail” banks, curbed neither by market nor by law. The last thing we need is consolidated communications monopolies, constricting the marketplace of ideas while gouging captured consumers.