Critics of Comcast-Time Warner Cable Deal Step Up Attacks

FCC turns attention to Comcast-TWC and AT&T-DirecTV mergers after net neutrality vote

Critics of Comcast’s deal for Time Warner Cable are stepping up their efforts to oppose the deal, as the FCC turns its attention from one controversial issue in net neutrality toward two others: whether to approve both the Comcast $45 billion deal for TWC and AT&T’s $49 billion deal for DirecTV.

Arguing that the FCC’s decision to take action on net neutrality doesn’t change any of the reasons the agency and the Justice Department should reject Comcast’s deal, the Stop Mega Comcast Coalition and the Networks for Competition and Choice members at a press conference Monday said the Comcast deal remains bad for consumers and for the creative industry and threatens competition.

“The merger increases the incentive and ability of the merged entity to harm current competitors,” said Markham Erickson, speaking for the Networks for Competition and Choice. He said the leverage that Comcast would have with TWC’s subscribers added in would make it difficult for competitors to offer real competition.

Jeff Blum, deputy general counsel of Dish Network, said “net neutrality does not come close to stopping” the competitive harms of the Comcast deal.

“There are innumerable ways they can sabotage over-the-top competition,” Blum said of attempts to offer alternatives to cable TV over the Web.

Both the Comcast and the AT&T deal need approval from the Justice Department and from the FCC. The Justice Department considers the anti-trust implications of each deal, while the FCC considers the public interest impacts.

Both deals have drawn opposition, but the opposition to the Comcast deals has been far more fierce.

While the AT&T-DirecTV deal is likely to win approval with conditions, critics of the Comcast deal have urged its rejection. They argue it gives Comcast too big a percentage of cable subscribers and broadband users.

Comcast argues that because TWC and Comcast operate in different areas, the deal offers no antitrust impact. It argues the deal benefits consumers and is necessary for Comcast to achieve the kind of efficiencies rivals have.

Critics say the clout the deal would give Comcast in negotiating programming contracts will make it difficult for rivals to fairly compete.

Blum said Comcast could sign deals with content providers that would hamper their ability to offer similar content over the Web and could use its leverage to get pricing that smaller content providers can’t match. He said the end result would make it difficult for rivals to launch competing operations in Comcast territories.

Not yet clear is whether the FCC and Chairman Tom Wheeler, having fought a bruising battle over net neutrality, might be reluctant to face another bruising fight over the mergers.

“Just having a taken a very strong action on net neutrality, I don’t think the chairman would be very happy to allow a merger to go through that could eviscerate the net neutrality protections that allows them to achieve some of the same anticompetitive means through other ends,” said John Bergmayer, senior staff attorney for Public Knowledge.

Bergmayer added he didn’t have the impression the FCC was making “political considerations” a factor in reviewing the Comcast’s deal programming implications.