Merger of cable giants needs to be stopped
When one big company merges with another big company, it’s usually great for shareholders and top executives, but not so good for consumers. That’s why I think the proposed merger of two of the country’s largest cable companies, Comcast and Time Warner Cable, raises some serious red flags.
The two announced plans for their merger in February, with Comcast planning to buy Time Warner Cable for $45 billion. If it goes through, the mega-merger would create a company that controls a third of the country’s cable TV market, 40 percent of the home broadband market, and more than half of the country’s bundled services (TV, phone and Internet). These numbers are simply staggering.
With much less competition, I’m concerned that this would mean higher rates for consumers. Those rates have already increased over the last few years much faster than the prices of other goods.
But just as concerning is the impact this merger could have on net neutrality and the future of the Internet.
The Internet turns 25 this month and net neutrality is one of the guiding principles that has made it so successful over that time. Net neutrality means that users have equal, unfettered access to the content they want to see, and that no site in particular gets special treatment. The data you’re accessing travels freely through the Internet, regardless of whether it’s from your cousin’s blog or a huge site like Amazon.com.
Why is net neutrality so important? Because it creates an even playing field where users get to decide what succeeds and what doesn’t. It allows small start-ups to compete with large companies, and has led to innovations that have changed our everyday lives.
A merger between Time Warner Cable and Comcast could seriously impact net neutrality because the resulting company would control so much of the country’s broadband network. The company could give favorable treatment to its own products while slowing down the competition. It could charge a premium to content providers for unfettered access to their customers. And it could mean that small start-ups would have a harder time competing with companies that can afford premium access.
Sadly, we’re already seeing some of this happen. A few weeks ago news came out that streaming video provider Netflix will have to pay Comcast millions of dollars a year for uninterrupted access to the cable company’s customers. I’m afraid those costs will almost certainly be passed on to consumers. Comcast’s merger with Time Warner would give the company even more leverage in forcing these kinds of deals — defying the very spirit that led to the Internet’s rise.
Thankfully, there is something we can do about it. The Federal Communications Commission and the Justice Department have the ability to block this merger if they decide it will create a monopoly with negative impacts for consumers. Earlier this month I sent a letter to the Chairman of the FCC and the Attorney General asking them to do everything in their power to block this merger.
I think the case is clear, and I’ve heard from a lot of Mainers who agree. Over 4,500 people responded to a survey I sent out recently — 4,200 of them opposed the merger and only 300 thought it should be allowed to go through.
With such wide-ranging impacts, I’d like to hear your feedback on the issue. If you have a moment, please go to www.pingree.house.gov/survey to submit your opinion.
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