You may have thought we were safe from mega mergers, but look again. Last year, the FCC refused the unholy union between Comcast and Time Warner Cable but they are now considering, and appear to be ready to approve, a merger that is just as alarming.
Earlier this week, the Wall Street Journal reported that FCC Chairman Tom Wheeler may soon move to allow Charter to take over Time Warner Cable and Bright House Networks. Additional coverage is at Ars Technica. The $90 billion takeover would propel Charter into the role of the second largest Internet service provider in the nation after Comcast. The two together would control the majority of U.S. high-speed Internet access subscriptions - over 70 percent of the market.
Sound scary? Former FCC Commissioner Michael Copps thinks so, too. In an excellent article on Medium and reposted by the Benton Foundation, Copps points out some of the pitfalls this deal presents.
In addition to the obvious problem of creating a monster sized cable company, Copps points out that Monster #1 (Comcast) and the new Monster #2 (Charter/TWC/Bright House) operate in different markets and would not compete with each other. Copps says:
The two companies would have no incentive to compete against each other, but every incentive to coordinate against their shared marketplace competitors.
Thanks to services like Netflix, Hulu, and Sling, television is in the midst of a creative renaissance. These emerging services are finally breaking the decades-long stranglehold of the cable bundle on American consumers who have been forced to collectively fork over billions of dollars in monthly cable bills, largely to pay for channels they never watch. The services’ growth has been fabulous for consumers, content creators, and workers in the entertainment industry. Now, just when competition is finally gaining traction, the Comcast-Mega Cable duopoly could squash it.
He also points out that, once Monsters #1 and #2 control most of the access, we can say good bye to diversity of media. We already have a problem with media concentration in the hands of only a few conglomerates and this deal will only aggravate the lack of perspective. When a country faces this problem, we block out independent voices.
Lastly, prices will likely increase so Charter can finance its $27 billion in new debt to cover the transaction. By Copps calculation, this amounts to approximately $1,142 per subscriber.
There is still time to voice your opposition to this merger. Common Cause and FreePress have each prepared online petitions and you can call the decision makers directly:
- FCC Chairman Tom Wheeler: (202) 418-1000
- FCC Commissioner Mignon Clyburn: (202) 418-2100
- FCC Commissioner Jessica Rosenworcel: 1-202-418-2400
In the words of Michael Copps:
The bottom line is that this merger is no less threatening to consumers than the Comcast-Time Warner Cable tie-up would have been. It points a dagger directly at competition, diversity in programming and consumer rights. Before it’s too late, the public should send a message telling regulators to once again stand up to the cable giants and stop this harmful merger.