By Rob Burgess
— There has to be a more fitting word for what’s about to happen in the telecommunications industry, but “oligopoly” is the only one I can come up with.
“Comcast Corp. will buy Time Warner Cable Inc. for about $45.2 billion in a deal that would combine the nation’s top two cable TV companies and create a dominant force in creating and delivering entertainment,” reported The Associated Press Feb. 13.
“The all-stock deal, which was approved by the boards of both companies, trumps a proposal from Charter Communications to buy Time Warner Cable for about $38 billion. It is expected to close by the end of the year, pending shareholder and regulatory approvals.”
The news made my stomach turn for many reasons and all at once.
For one, I was upset at the future prospects for net neutrality, which has been looking bleaker by the day. Net neutrality means the Internet should be charged for equally, regardless of use. Historically, Comcast has fought hard against this idea.
“Comcast Corp. actively interferes with attempts by some of its high-speed Internet subscribers to share files online, a move that runs counter to the tradition of treating all types of Net traffic equally,” reported the AP’s Peter Svensson Oct. 19, 2007. For years afterward, Comcast carried out a policy of capping users. (This policy has since been altered. “On May 17, 2012, we announced the suspension of our 250 GB usage allowance and that we would trial and launch new data usage plans,” reads Comcast’s XFINITY Support page.)
Comcast agreed to abide by the principles of net neutrality — for now — as a Federal Communications Commission condition of the company’s $13.8 billion acquisition of NBC Universal from General Electric Co. “The consent decree, which is designed to protect competition, extends through the end of 2017. Time Warner Cable would also be subject to these same terms, if the merger is consummated,” reported Dawn C. Chmielewski of The Los Angeles Times Feb. 13.
Retired FCC Chairman Michael J. Copps has been warning of the dangers of the increasing lack of diversity for years. On Jan. 18, 2011, he was the only one of the five commissioners to vote against the Comcast/NBC Universal deal.
“The public interest requires more — much more — than it is receiving,” Copps wrote in his dissenting opinion. “[The deal] opens the door to the cable-ization of the open Internet. The potential for walled gardens, toll booths, content prioritization, access fees to reach end users, and a stake in the heart of independent content production is now very real.”
And with the news of this latest Comcast purchase, Copps made it clear there was no love lost for the idea.
“This is content and distribution,” said Copps Feb. 17 in an interview with Amy Goodman on “Democracy Now.” “This is the John D. Rockefeller recipe for monopoly control. You’ve got the whole thing, when you’re controlling the programs, designing the programs and distributing them, or deciding whether they’re not going to be distributed.”
But, as I said, Copps is retired now. All that’s left are just a few formalities to take care of and the deal is as good as sealed. On top of the FCC hearing, the Senate Judiciary Committee plans to hold a hearing March 26, reported Reuters on Monday.
“I and my colleagues will have to review the facts, as presented to us, the opinions people on the outside ... and reach a judgment,” FCC Commissioner Ajit Pai told CNN’s “The Lead with Jake Tapper” Friday.
Now, I’m no soothsayer, and I’m not generally a betting man, but if I had to guess, I would say this latest merger is going to encounter minimal interference from the FCC. I can nearly smell the rubber stamp being inked from here.
“When deep space exploration ramps up, it’ll be the corporations that name everything,” intones the unnamed protagonist in the movie “Fight Club.” “The IBM Stellar Sphere. The Microsoft Galaxy.” And, coming soon: Planet Comcast Time Warner Cable.
Rob Burgess, Tribune night editor, may be reached by calling 765-454-8577, via email at email@example.com or on Twitter at twitter.com/robaburg.