Reports that attorneys at the Department of Justice (DOJ) may recommend blocking Comcast’s proposed acquisition of Time Warner Cable are good news, because if this $45 billion deal goes through, it will create a telecom behemoth unlike anything we’ve ever seen before.
Comcast is already the nation’s largest cable company and largest broadband Internet provider; Time Warner Cable is the second-largest cable company and third-largest broadband Internet provider. Under the Federal Communications Commission’s (FCC) updated definition of broadband, the new mega-Comcast would control 57 percent of the high-speed Internet market.
This colossus of a company would have unmatched power to destroy its competition, abuse its customers, and bully the government agencies charged with regulating it. Consumers would face even higher prices, even fewer choices, and, if you can believe such a thing is possible, even worse service.
That’s why I’ve been a vocal opponent of this proposed acquisition since shortly after it was announced last year. I think consumers should come first when it comes to technology policy – and I believe they’ll get a raw deal if this transaction is allowed to go through.
The fight to stop this acquisition is an uphill battle against a corporation that is already incredibly powerful. But there are good reasons to believe we have a shot.
I think consumers should come first when it comes to technology policy – and I believe they’ll get a raw deal if this transaction is allowed to go through.
Here’s one of them: A year ago, it looked like net neutrality was in real trouble. Even though the Internet had always been a free and open platform, the big Internet service providers (ISPs) had been pushing the FCC to create fast and slow lanes online – and in May 2014, the FCC issued a draft proposal that would have done exactly that. ISPs like Comcast stood to make a ton of extra money by charging websites through the nose for access to the fast lanes, but for consumers and small (and most large) businesses, the end of net neutrality would have been a disaster.
So we organized, and we fought back. Millions of Americans raised their voices in protest – signing petitions, writing letters, even showing up at congressional hearings. And we won: The FCC changed its mind and decided to adopt bright-line rules to preserve net neutrality, ensuring that the Internet will remain a place where everyone can participate on equal footing, without fast and slow lanes, and free from interference from the big ISPs.
The successful effort to save net neutrality is an example of how grassroots organizing can overcome the big guys’ lobbying power. But it also provides a prime example of how duplicitous these big guys can be in trying to get their way.
During the net neutrality debate, Comcast ran ads touting themselves as champions of net neutrality. In fact, they boasted that they were “the only ISP in America legally bound by full net neutrality rules,” and that acquiring Time Warner Cable would mean “extending that protection to more people.”
This was deeply misleading. Comcast was indeed legally bound to obey net neutrality as a condition of their acquisition of NBCUniversal a few years back. But that condition was set to expire in 2018. And even though I asked repeatedly, both in letters and in person at Senate hearings, Comcast refused to commit to continuing to abide by those net neutrality rules after that date.
Another hint that Comcast was being less than sincere about their support for net neutrality was that they deployed their massive army of lobbyists to try to convince the FCC not to impose strong net neutrality protections. And when the FCC ultimately decided to side with consumers in February 2015, Comcast went nuts, protesting that net neutrality would ruin their business plan (and warning that legal action would ensue).
And believe it or not, even after all this, Comcast continued to run online ads claiming that support of net neutrality is an argument in favor of their proposed acquisition of Time Warner Cable, because the deal would, in their words, mean “net neutrality for more people.” This is nonsense: Thanks to the FCC’s new rules, net neutrality is now the law of the land for all broadband providers, regardless of whether this acquisition is approved.
Comcast has deliberately misled on net neutrality from day one. But while the net neutrality issue has been resolved, there are many other concerns about what the deal would mean for the broadband market – and for consumers’ cable and Internet bills. And net neutrality, as it turns out, isn’t the only area where Comcast has proven to be greedy and dishonest.
Net neutrality, as it turns out, isn’t the only area where Comcast has proven to be greedy and dishonest.
When the Comcast/NBCUniversal acquisition was on the table, I and others worried about vertical integration: Comcast already owned the pipes through which cable programming flowed, and now they’d also own NBC, MSNBC, Telemundo, Bravo, USA, and numerous other popular networks. So, as a condition of the deal, Comcast had to agree to something called “neighborhooding” – they had to promise to locate their own channels in the same part of the dial as competing channels, instead of giving their own programming favorable locations and relegating the competition to the outer reaches of the cable channel lineup where viewers would never be able to find it.
Well, guess what happened. CNBC, a business channel owned by Comcast, was given a prime location, while Bloomberg’s business channel, a direct competitor, got stuck in the cheap seats.Forget about the same “neighborhood” – Comcast stuck Bloomberg in a different time zone.
As another condition, Comcast agreed to create a standalone broadband product so that people who only wanted Internet service and not cable TV wouldn’t have to buy an expensive bundle. Comcast created the product – they just didn’t tell anyone about it. Not only did they fail to actively promote the standalone product, they left it out of pricing materials and declined to offer it at all retail locations.
The FCC fined Comcast for violating this condition, and ordered the company to train its call center employees so that they could make customers aware of the standalone product. Comcast promptly set out to do the exact opposite, telling Wall Street investors that, with Time Warner Cable in the fold, they would teach their employees to “bundle better,” pushing the packaged cable and Internet services more aggressively.
No company should be entrusted with the kind of dominant market position Comcast is seeking in this deal, especially when the company in question has proven that they simply can’t be trusted.
That’s why concern is spreading about this proposed deal. More and more consumer groups are coming out against it, and business coalitions are doing the same (even though, in a telling example of the outsized power Comcast already has, some of its competitors have declined to join the opposition because, they tell me, they’re concerned they’ll face retribution from the telecom giant if they do). Meanwhile, Wall Street is no longer betting that the deal is a sure thing, and prognosticators have lowered their odds that it will happen.
No company should be entrusted with the kind of dominant market position Comcast is seeking in this deal, especially when the company in question has proven that they simply can’t be trusted.
Let’s be clear: Anytime we’re going up against Comcast’s lobbying might, we’re the underdog. And while more and more Americans are voicing their opposition to this deal, the final decision will rest with the FCC and DOJ.
But the FCC’s decision on net neutrality has given me new hope that, with a loud enough movement – with enough people like you organizing online, calling your members of Congress, and writing to the FCC and DOJ – we might just be able to win another uphill battle. We might just be able to stop this deal before Comcast gains even more power to pad their profits at consumers’ expense.
Editor’s Note: U.S. Senator Al Franken was born on May 21, 1951, and grew up in St. Louis Park, Minnesota. Before running for the Senate, Al spent 37 years as a comedy writer, author, and radio talk show host and has taken part in seven USO tours, visiting our troops overseas in Germany, Bosnia, Kosovo, and Uzbekistan-as well as visiting Iraq, Afghanistan, and Kuwait four times.