Washington

Sen. Klobuchar Will Hold a Hearing to Scrutinize Comcast/TWC

Talks of potential impact; Sen. Mike Lee talks of "benefits and challenges" of potential merger 2/13/2014 11:55:00 AM Eastern

RELATED: Time Warner Cable Agrees To $45.2B Offer From Comcast

Reaction was swift to Comcast's proposed merger with Time Warner Cable, including the pledge of a Senate hearing to vet the deal.

“This proposed merger could have a significant impact on the cable industry and affect consumers across the country,” Sen. Amy Klobuchar (D-Minn.) said. “As chair of the Senate Antitrust Subcommittee, I plan to hold a hearing to carefully scrutinize the details of this merger and its potential consequences for both consumers and competition.”

Klobuchar looks for her fellow Minnesota Democratic Senator, Al Franken, to have plenty to say about the deal as well. He was a big critic of the Comcast/NBCU deal and of media consolidation in general.

Also weighing in was subcommittee ranking member Mike Lee (R-Utah) who said he was looking forward to evaluating the "benefits and challenges" of the merger. "Vibrant competition in the cable industry ensures reasonable pricing and quality service for millions of cable subscribers,” he said.

Even in snowed-in, shut down Washington, some public advocacy groups were quick to react and tended toward dire warnings.

"Don't Let Comcast Kill Competition and Innovation," read the headline on Public Knowledge's e-mail. Consumers Union immediately opposed the deal, saying it had the potential to be a "very bad deal" for consumers.

Former FCC chairman Mike Copps, a veteran consolidation critic now with Common Cause, called the deal an "affront to the public interest," adding: “This is so over the top that it ought to be dead on arrival at the FCC." Copps pointed out that he had cast the lone vote in opposition to the Comcast/NBCU merger.

The Writers Guild of America, West, suggested its members wanted to write a death scene for the deal.

“Comcast’s proposed merger with Time Warner Cable is bad for everyone: content creators, programmers, suppliers, and consumers.  As writers know all too well, media consolidation leads to already too powerful companies limiting competition. The WGAW will fight to stop this ill-conceived merger.”

The Future of Music Coalition said the merger would be a "bum note" for musicians and others.

“Musicians and other media-makers require affordable, high-quality internet service for everything from selling music and merchandise to booking tours to staying in touch with fans," said FMC Interim executive director Casey Rae. "Our livelihoods also depend on being able to reach audiences in the ways that make the most sense for us. Comcast’s proposed takeover of Time Warner Cable would give one company incredible influence over how music and other media is accessed and under what conditions.

The American Cable Association weighed in with a deal condition, or more to the point a condition of even considering the deal.

“Comcast-NBCU’s takeover of Time Warner Cable would vastly increase the number of cable homes served by an operator affiliated with NBCU’s popular programming," ACA said in a statement, "creating new incentives for NBCU to demand unfair terms and conditions from TWC’s pay-TV distribution rivals, including ACA Members.

“Small and medium-sized cable operators have highlighted for nearly two years that they have less protection from this sort of vertical integration than Congress intended in view of the fact that the Federal Communications Commission has yet to act on its own rulemaking to update the FCC’s definition of a ‘buying group’ to reflect today’s market.

“The current definition effectively excludes the National Cable Television Cooperative, the buying group used by more than 900 small and medium-sized cable operators, from utilizing program access rules that require cable-affiliated programmers to offer programming on non-discriminatory prices, terms and conditions."

“In our view, the FCC needs to complete the program access/buying group rulemaking before it starts its public interest review of the Comcast-NBCU/TWC transaction."

“Combining Comcast and Time Warner Cable would create a behemoth of near-unstoppable market power that will invariably be anti-consumer and anti-family," said Parents Television Council President Tim Winter. "The end result will create the biggest media company in the world with control of nearly half of all TV sets in the country and would make what

is already the biggest broadband provider even bigger. Bigger doesn’t mean better, particularly where consumers and families are concerned. Cable prices keep rising and they surely would continue to do so if Comcast and Time Warner Cable merge. Not only that, but Comcast would have more control over what consumers can watch or download."

Comcast EVP David Cohen said that while he could not guarantee prices would go down or stay the same, he did say he did not see way the deal would not result in benefit to the consumer in a myriad of ways, from faster broadband to more diverse programming.

But not everyone was bashing the combo.

Randolph May, who runs the deregulatory minded free market think tank, Free State Foundation had this to say: "Like any transaction of this size, the proposed Comcast-Time Warner Cable merger deserves close scrutiny and I'm sure it will receive it. But it also deserves scrutiny that is based on the facts and that is free from the hyperbolic rhetoric that 'consumer' and 'public interest' groups and others deploy in reacting in knee-jerk fashion to any merger proposal involving large corporations."

May said the key fact is that the deal is "horizontal," meaning that "Comcast and TWC do not compete with each other in any material way in any market segment with respect to their broadband data, video, and voice telephony offerings."

“Not only is the Comcast-Time Warner Cable merger pro-competitive via the improvement of services and innovation for millions of Americans and many thousands of businesses," said "Scott Cleland, chairman of NetCompetition, "this merger also is occurring in the most competitive communications marketplace with the most consumer choices ever. It should be approved.”

 

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