A group of opponents to the $45.2 billion Comcast-Time Warner Cable merger have officially formed their own coalition against the deal, calling for federal regulators to reject the merger outright.
The Stop Mega Comcast Coalition consists of 15 separate entities, many of which have filed individual objections to the deal with the Federal Communications Commission in the past, including public interest groups like Washington watchdog group Public Knowledge; distributors like Dish Network and Hargray Communications; independent cable networks like TheBlaze and Weather Nation; labor unions such as the Writers Guild of America ,West; and industry associations like NTCA—The Rural Broadband Association.
But in a twist that sets them apart from other opponents of the deal, Stop Mega Comcast isn’t looking for the FCC to implement strict conditions on the deal, like Title II. They don’t believe Comcast-Time Warner Cable should be approved under any circumstances.
Comcast and Time Warner Cable announced their plans to merge in February, and the potential union has set off a firestorm of controversy. While Comcast and TWC say they will comply with any reasonable conditions the FCC places on a deal, critics still complain the transaction will create a media and Internet powerhouse with too much scale and scope.
“A competitive and diverse media and technology marketplace is fundamental to the health of our economy and our democracy,” said Public Knowledge CEO Gene Kimmelman in a statement. “If this merger goes through, Mega Comcast would control an unprecedented 50% of the high-speed broadband wires across the country, and would be on a path to virtual dominance of the high-speed broadband market given that the combined company will pass two-thirds of U.S. households. This much power concentrated in the hands of one company would be frightening even for the most trustworthy of companies. And Comcast is definitely not that.”
In a statement, Comcast denied the Coalition's claims.
“Hundreds of community organizations, programmers, lawmakers and diversity groups have praised the pro-consumer benefits of this transaction," Comcast said in a statement. "It is no secret that some companies that want billions of dollars in higher fees for consumers are paying lobbying firms to organize against this transaction. This minority of self-interested opponents has used the same tactics in our past deals, and their claims were not found to be credible by the expert agencies. We believe the same will be true here."
The new coalition echo fears that other organizations have expressed in the past – that with control of more than 50% of the broadband market in the U.S. the combined Comcast-TWC would become the gatekeeper to America’s high-speed broadband homes. Allowing one company to have that kind of influence could also adversely affect four other key market segments, according to the group:
Programming and pay TV: Comcast-TWC would be the dominant distributor iln the country with about 30 million customers and could give greater priority to networks it owns (through NBC Universal) over others.
“Granting Comcast more gatekeeping power will stifle the free exchange of information and ideas by providing Comcast with greater incentive and ability to block competing channels and opposing viewpoints from access to its customers in order to advantage its own content or its political point of view,” said TheBlaze president of business development Lynne Costantini, in a statement.
Connected consumer devices: Its X1 operating system would become the default streaming system for the vast majority of broadband customers, giving Comcast-TWC unprecedented control over content that is available on the Web.
“As the gatekeeper to half of all high-speed broadband connections in the United States, Mega Comcast would have the power to limit which, if any, competing over-the-top services its customers can access,” said Jeff Blum, senior vice president and deputy general counsel, Dish Network. “The inevitable result of this merger: fewer options at a higher price.”
Local Advertising: The combined company would control 71% of the local cable advertising market, giving Comcast-TWC the power to hike rates for small businesses and cable companies, which could increase costs for small businesses and raise prices for consumers;
Latino and Minorities: Comcast-TWC would reach more that 91% of Latino households in 19 of the top 20 Latino markets in the country, meaning the combination could results in fewer programming choices, lower quality programming and fewer opportunities for Latinos in the creative content industries.
Whether the combined group will have any more clout in influencing the FCC’s decision remains to be seen. The agency stopped the 180-day shot clock on the merger approval process in October, but is scheduled to restart it soon. Both Comcast and TWC have said they expect the approval process to be completed in time for a first quarter 2015 closing of the transaction.
As of Dec. 3, the Stop Mega-Comcast Coalition includes:
Consumer Federation of America
Parents Television Council
Sports Fan Coalition
Writers Guild of America, West
Future of Music Coalition
NTCA—The Rural Broadband Association