On Wednesday night, the first and second largest cable companies in the US, Comcast and Time Warner Cable, announced they plan to merge into a telecom megacorporation that would threaten to monopolize the cable and broadband industry.

But first they have to win what’s sure to be a rough regulatory fight.

The $45 billion merger’s not a done deal unless the cable giants can get approval from both the Department of Justice, which will be looking to make sure the acquisition doesn’t violate antitrust laws, and the Federal Communications Commission, which is responsible by law not to approve the deal unless it serves the “public interest.”

Comcast won’t have any easy time making its case on either count. It’s fended off antitrust concerns by claiming the two companies don’t actually compete in the same markets. While this is technically true, it’s hardly comforting. As most anyone with a cable or broadband subscription knows, the two giants have been operating as a duopoly—your area is served by one or the other, and that’s the only option you have.

What’s more, Comcast and Time Warner aren’t just cable providers; they’re content companies and internet service providers. Comcast owns NBC, one of the largest TV networks. By acquiring Time Warner, the behemoth corporation would have the power to stifle competing media companies and internet video services, especially since the collapse of net neutrality regulations. John Bergmayer, senior staff attorney for Public Knowledge, said an enlarged Comcast would be like a "bully in the schoolyard."

Proving the merger would be in the public’s best interest may be an even harder hurdle to clear. The cozy duopoloy has already left cable and internet prices frustratingly high, and consumers with no choice but to pony up. The deal would leave Comcast in a good position to hike up rates even further: With expanded power and money the telecom could gobble up what little competition is left.

One potential upswing is that the FCC could use the opportunity to force some rules on Comcast. The telecom agreed to adhere to open internet rules, which still applies despite the court’s decision to strike down aspects of net neutrality. The merger would extend the deal to Time Warner Cable customers, and the FCC could ostensibly require other protections in exchange for approving the merger, such as affordable internet for low-income consumers.

Still, the the agency will be hard-pressed to find a way in which corporate consolidation benefits consumers.

If the FCC and DoJ do approve the deal, it’ll likely be because Comcast has a lot of clout in Washington.

Comcast has a powerful team of lobbyists on K Street; it’s donated millions to the political campaigns of many of the most influential members of Congress, as well as the president.

Last year, the company spent more than $18 million to lobby Congress on issues like cable laws and net neutrality, and donated $1.7 million to the reelection campaigns of key lawmakers, according to data from Open Secrets. That includes Rep. Greg Walden, chairman of the subcommittee on communications and technology, which has jurisdiction over the FCC.

In 2012 Comcast gave $854,000 to members of that subcommittee alone, according to figures dug up by Maplight.

Indeed, to find a precedent for mergers resulting in a near-monopoly getting past federal protections, you don’t need to look any further than Comcast’s history. In 2011 it won a regulatory victory for its major merger with NBC. Comcast’s sizable lobbying team includes more than one former FCC officials, one of whom was brought on to help push the NBC merger through. That time around, the lobbying began more than a year before the deal was closed, and Comcast spent some $17 million sweetening the deal for lawmakers and regulators.

At this point, consumer groups are already pressuring Obama to block the merger. But while their case is strong, their pocket books aren’t. Is Comcast’s spending spree enough to muscle the deal through? Crazier things have happened in Washington.

rest at


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s