A Time for “No!”

Presented in partnership with the Benton Foundation

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How much more do regulators need to know before they understand that the proposed Comcast-Time Warner Cable merger is bad news all around?  It’s bad for consumers, competition, and our very democracy.  Everywhere I go I hear people complaining about spiraling cable bills and poor customer service.  They tell me about hyper- expensive, slow, and often not even available high-speed broadband.  And they voice concerns over dumbed-down news and information programming that is generally an insult to the intelligence of citizens.  These are not partisan complaints, either.  Paying outlandish bills isn’t a red or blue state issue—the color of a consumer’s money is green wherever you go.  And the dedication to an informed democratic dialogue does not track party lines either, at least outside Washington, DC.  Concerns about curbing market power, fostering consumer-friendly competition, and being well-informed are All-American issues.  Respected newspapers and journals and communications experts increasingly understand this and have concluded that this deal is not good for us as consumers and citizens.  An overwhelming majority of people I meet and of expert opinion prefer this proposal not be approved by the two agencies charged with reviewing it—the Federal Communications Commission (FCC) and the Department of Justice (DOJ).  What is good for Comcast is not in this case good for the country.

It was just last year that Comcast found $16.7 billion to complete its purchase of the last 49% of NBC/Universal from General Electric.  (Let’s not even get into why GE was in the media business!)  I thought that would maybe keep Comcast out of the buyer’s market for a while, but already the company has found another $45 billion to purchase the nation’s second largest cable and Internet provider, Time Warner Cable.  Rising cable bills and rationing broadband scarcity apparently work well as a business plan.  For consumers—well, that’s a different story.

Word is it could take many months, maybe close to a year, for the two government agencies to conduct and complete their reviews.  Really?  The facts of the case should lead both agencies to speedy thumbs-down decisions.

Fact Number One: The merged company would further diminish competition.   The two firms argue that since they do not compete in most of the same markets, competition is unaffected.  But how does making Comcast significantly more powerful and giving it even more territory and content to control help independent and diverse voices break through?  A footprint this huge makes a mockery of the idea of a competitive marketplace.  It is inevitably a major step toward market control when the number one company in an industry absorbs the number two firm.  It is also an interesting question to ask why Comcast and Time Warner Cable have not competed against one another in more markets all these years.  That would be an interesting question for the Department of Justice to investigate.

Fact Number Two: Consumers, long hurting from over-priced cable and from scarce and costly broadband, would face even higher bills.  We don’t need more studies or government agency inquiries to document the reality of rising cable costs.  Consumers know firsthand what studies have long-since proved—cable bills keep rising far faster than the rate of inflation.  One would be forgiven for expecting that Comcast might hold out the promise of lower consumer bills if the merger is permitted to go forward.  But the company admits it will not promise lower bills—nor even a slowing of the rise in monthly consumer costs.

But the big prize here is not basic cable service.  It is broadband.  A merger of these two huge broadband providers will give Comcast gatekeeper control over Internet access (and a lot of Internet content, too) across broad swathes of the nation.  In many areas it will enjoy de facto monopoly.  Remember that we are talking here about the most dynamic, opportunity-creating communications technology in perhaps all of history.  Broadband should be all about power to the people—a place of easy, open access where consumers are in maximum control of their online experiences rather than being captive to the whims of gatekeepers.   Instead we have Internet access providers who would rather cherry-pick the neighborhoods where they build and ration scarce broadband to serve the bottom line of their business plans and those quarterly reports that are behind so many of America’s problems right now.

Truth compels us to observe that the fault is not entirely the companies’.  Broadband penetration in our country has been seriously hobbled by the lack of a real national mission to deploy high-speed networks ubiquitously, so that everyone, no matter who they are, where they live, or the particular circumstances of their individual lives, has affordable and ready access to high-speed service.  For years, government labored under the misguided theory of so-called “experts” who stubbornly maintained that the market alone would bring high-value broadband to every nook and cranny of America (at least that’s what they told us; maybe they knew better all along).  This is not how transformative infrastructure like highways, railroads, and rural electricity got built.  History tells us there was a national vision to get those projects built, accompanied by private-public partnerships to make it happen.  While the President occasionally refers to such a vision, he has never put the muscle of his office behind it.  The result:  his country and ours is way down in the international rankings for broadband penetration, speed, and cost.   Some studies put us at 15th, others in the 40s or 50s.  We don’t need to argue about which study is exactly right—the point is that the United States needs to be in the vanguard, not among the also-rans.

Approval of the Comcast-Time Warner Cable transaction means more of the same failed approach.  Let the big get bigger, permit prices to spiral, and keep holding back a technology that should be making this a golden age of communications—not an age when a few get the gold.  It also means more of the kind of lobbying these huge cable and telecommunications titans have used to pass laws in some 19 states so that communities and municipalities face nearly impossible obstacles if they want to build their own broadband networks, even where Comcast, Verizon and AT&T don’t want to build right now because it doesn’t fit their business plans; these companies don’t want anyone else building there either.  Yet where municipal systems have been built, like Chattanooga, TN and Lafayette, LA, they have achieved spectacular results.

Fact Number Three:  This proposal, if approved, would wreak significant harm on our civic dialogue and, indeed, on our democracy.  Sometimes we get so focused on the technological and business aspects of communications that we forget how important decisions like this are to our public well-being.  When as a matter of policy we allow a company to achieve such extensive control over both the content and distribution of what we see and hear and read, we confer upon them awesome power to direct, even control, the small “d” democratic dialogue that citizens must have with one another if we are successfully to master the art of self-government.  When a content-producing behemoth can put competitive content-producers out of business, then its own content is what people see.  When that same company controls the distribution of the content and can speed it up, slow it down, or even block it (all of which is legal in the current absence of strong Open Internet—network neutrality—rules), it can decide what news it wants you to see and what it doesn’t want you to see.  It can impede sites whose messages it might not like, and keep reform and advocacy groups from organizing for their causes.  It can poison content creation and innovative social media.

That’s not fuel for a vibrant democracy.  It is gas-on-the-fire for special interests to wield power they should never have been allowed to amass in the first place.

I don’t believe that, apart from the cable barons themselves, anyone would welcome the cableization of the Internet.  Yet that is precisely the danger here.  And who better to cableize it than the biggest cable company? What a tragic denial of the promise of the Internet this would be!  Let’s get rid of this threat right now with clear and straight-from-the-shoulder denials of the merger by the Department of Justice and the FCC.  This is a time for “No!”

 

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About Michael Copps

Michael Copps served as a commissioner on the Federal Communications Commission from May 2001 to December 2011 and was the FCC's Acting Chairman from January to June 2009. His years at the Commission have been highlighted by his strong defense of the public interest; outreach to what he calls "non-traditional stakeholders" in the decisions of the FCC, particularly minorities, Native Americans and the various disabilities communities; and actions to stem the tide of what he regards as excessive consolidation in the nation's media and telecommunications industries. He is director of Common Cause's Media & Democracy Reform Initiative.

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