Comcast-Time Warner Hits Snag With DOJ Lawyers

Attorneys are forming a recommendation to block Comcast’s bid to buy Time Warner Cable Inc., according to reports

Last Updated: April 17, 2015 @ 12:26 PM

There might be a big snag in the long-rumored Comcast merger with Time Warner Cable Inc., as Justice Department attorneys are reportedly forming a recommendation to block the high-stakes media merger.

Bloomberg reported Friday that attorneys are looking into Comcast’s proposed $45.2 billion proposal to create one unified nationwide cable arm and are moving against the plan because of concerns that consumers could be harmed.

After the lawyers submit their challenges to Renata Hesse, a deputy assistant attorney general for antitrust, Hesse and colleagues will decide whether to file a federal suit to block the merger.

“The Comcast-Time Warner Cable transaction will result in significant consumer benefits — faster broadband speeds, access to a superior video experience, and more competition in business services resulting in billions of dollars of cost savings,” Joelle Terry, spokesperson for Comcast, said in a statement defending the deal. “These benefits have been essentially unchallenged in the record – and all can be achieved without any reduction of competition. As a result, there is no basis for a lawsuit to block the transaction.”

However, the line of big media companies and figures against the bid has gotten longer. Last year, Netflix CEO Reed Hastings came out swinging against the deal, saying Comcast already dominates enough of the cable market and it becoming bigger would be a detriment to competitiveness.

“The combined company would possess even more anti-competitive leverage to charge arbitrary interconnection tolls for access to their customers,” he said. “For this reason, Netflix opposes this merger.”

Digital and libertarian magnet Glenn Beck also stood firm: “Monopoly type [multichannel video programming distributors] like Comcast and Time Warner Cable do not have a good history of listening to customers or supporting independent programmers whose content is in demand like TheBlaze,” Beck said.

The broader Stop Mega Comcast group includes media companies, politicians and consumer advocates.

Both companies have conceded that passing regulatory guidelines isn’t a certainty.

“This is a bit of a black-box process,” Comcast executive vice president David L. Cohen told The New York Times in February. “You don’t really know what’s going on under the surface.”