Free Press Files Petition to Deny Comcast Takeover of Time Warner Cable

WASHINGTON -- Free Press today filed a “petition to deny” the proposed merger of Comcast and Time Warner Cable. The petition, submitted to the Federal Communications Commission, presents a definitive account of how the merger fails both the public interest and the antitrust tests required for regulatory approval.

The merger would create a telecommunications and pay-TV entity of unprecedented size and scope, reaching into six out of every 10 U.S. homes and controlling nearly half of the current advanced broadband-service subscribers. Its control over high-speed Internet services would eclipse the power once held by the monopoly Bell system.

Comcast’s resulting nationwide market reach and power would lead to direct consumer harms such as higher prices and fewer choices among competitors. The merged entity "would immediately control half of the nation’s bundled Internet access and pay-TV customers, a share that would quickly grow as DSL continues its now-accelerated decline into irrelevancy" according to the Free Press petition. Moreover, mobile, fixed LTE and satellite broadband should not be considered competitive alternatives to Comcast's wired services at a time when more and more consumers are seeking higher bandwidth options.

The content that is driving these increased demands for bandwidth is streaming video. "It is the growth in streaming video, and Netflix’s growth in particular, that serves as the primary factor for increased capabilities in the U.S. Internet access market," argues Free Press.

But Comcast isn't interested in meeting consumer demand for online video streaming. Free Press illustrates the great lengths to which the company has gone to frustrate the efficient delivery of the video streams its customers request. The reason: "Comcast is still primarily a vertically integrated pay-TV distributor and content owner. Last year, pay-TV and content comprised 72 percent of Comcast’s total revenues."

The merged entity would continue to protect its pay-TV offerings at the expense of the online video innovations sought by Internet users nationwide. Free Press argues that the merger "would increase Comcast’s incentives to harm further development of the streaming video market." Since the entity faces so little competition in this space, there is a "high possibility of unilateral and coordinated harms [that] would pose a grave danger to the development of the streaming video industry, and thus to further development of the U.S. advanced broadband market."

The suggestion that the merger has no impact on competition is self-serving and simply untrue, according to Free Press. "The merger ... would dramatically concentrate control over the most critical pathway for this free flow of information and ideas. It would give Comcast, a company with a demonstrated interest in favoring its own vertically owned content, substantially increased ability to do precisely that."

Read the petition to deny here: http://www.freepress.net/sites/default/files/resources/Free%20Press_14-57_Petition%20to%20Deny_Final.pdf