As a response to the thousands of comments on the FCC’s website pertaining to the Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC) merger, Comcast has released a public statement as a part of a blog post on the company’s own site detailing its side of the merger (really an acquisition, but acquisition is a dirty word). In the company’s own post is links to its official response to the FCC Comments with a 300+ page document that supposedly addresses the concerns and refutes others.
The document features sections titled:
THE TRANSACTION WILL PROVIDE SUBSTANTIAL PUBLIC INTEREST BENEFITS, AND CHALLENGES TO THESE BENEFITS ARE WITHOUT MERIT
Featuring Answers – The Transaction Will Enhance Competition and Choice for Businesses of All Sizes, The Transaction Will Accelerate the Deployment of Advanced Broadband Services, Increase Broadband Competition and Innovation, and Expand Broadband Adoption and many more.
This is just a short summation of Comcast’s comment responses and really illustrate the company’s complete and utter disconnect from reality.
Comcast is essentially claiming that Comcast and Time Warner Cable becoming one company will improve competition for businesses (who are already being ripped off) even though the combined company would very likely become the only game in town for many businesses. It also claims that it will accelerate the deployment of advanced broadband services, which may be why Time Warner Cable has started to roll out their MAXX service to select areas, but still keeps the majority of their customers at much lower speeds. In fact, Comcast’s customers at the very peak are only one-third the speed of Time Warner Cable’s fastest 300 Mbps service.
Additionally, Comcast claims that it will be able to increase broadband competition and innovation with this acquisition even though they are effectively gobbling up the number two cable ISP in the US after Comcast making them at least three times bigger than the next biggest competitor. And sure, the company can claim that this acquisition will somehow expand broadband adoption, but there’s no denying that broadband adoption would very likely continue at the same pace, if not faster without such a merger.
THE TRANSACTION WILL NOT HARM COMPETITION OR THE PUBLIC INTEREST
Featuring Answers – No Vertical Harms: The Transaction Will Not Facilitate Anticompetitive Foreclosure or Other Exclusionary Conduct, No Harm to Advertising, Petitioners Erroneously Define Certain “Relevant Markets.” – The Broadband Market Is Local, Not National.
They also want to make it clear that this merger will not affect competition or the public interest. The two companies do this by saying that there’s no way that they will partake in any anticompetitive behavior as a result of being owners of NBC Universal as well as tens of millions of cable customers as well as Comcast Sports and Time Warner Cable sports networks.
Both also claim that this will not harm advertising, which is very unlikely to be true because if there are fewer companies to advertise with, you’re very likely going to end up paying a higher price. Fewer cable operators and television networks simply means that advertisers are going to be dealing with Comcast more than they already do. They also claim that commenters are incorrectly defining the relevant markets at hand, saying that the broadband market is not a national one, but rather a local one. But if you look at most local broadband markets, there is very little to no competition and Comcast will become a bigger competitor in most local markets. Sure, Comcast and Time Warner Cable don’t actually compete with each other very often, but that’s because most cable operators have local monopolies on cable TV and cable internet services.
OTHER ISSUES RAISED BY COMMENTERS ARE NOT TRANSACTION-SPECIFIC, ARE ADDRESSED IN OTHER PROCEEDINGS, OR ARE OTHERWISE EXTRANEOUS, AND THUS ARE IRRELEVANT TO THE COMMISSION’S ANALYSIS
Featuring Answers – Customer Service, Customer Prices, Municipal Broadband
Then the two go on to address all of the comments that they believe have nothing to do with the Comcast and Time Warner Cable acquisition and that they are addressed elsewhere or completely irrelevant. They don’t believe that topics like customer service, consumer prices or the stifling of municipal broadband are relevant to such an enormous deal such as this one. In fact, the whole episode of Ryan Block trying to leave Comcast being like pulling teeth is a perfect example of how a company has policies in place in order to prevent customers from leaving even though they clearly wish to leave.
Comcast’s behavior in terms of customer service in that situation is why their customer service should be considered a part of this transaction and therefore relevant. They also talk about how consumer prices are not relevant to the topic at hand, when in reality it should be one of the most relevant topics because Americans grossly overpay for the speeds that they get compared to other developed countries and if Comcast doesn’t want to talk about that, then they don’t deserve this merger. And last but not least, they talk about the issue of municipal broadband, also known as competition, which they clearly hate and have actively lobbied against in multiple states and even gotten some states to ban via lobbying of certain state legislatures.
Comcast’s own delusions continue in its claims that “Including wireless, 99% of households have the choice of at least three fixed or mobile broadband providers offering speeds of at least 3 Mbps, and approximately 98% have two or more choices offering speeds of at least 10 Mbps.”
Somehow, Comcast believes that people’s wireless broadband service is competitive with its own landline fixed service. They create the illusion that there are at least three competitive service providers in 99% of the country, when the reality is that mobile broadband providers generally cap users at 2, 5 and 10 GB of data a month, which is not ample enough to actually use for a home connection, especially for an entire family. Additionally, Comcast neglects to mention that in most areas consumers have one or two choices with a specific cable provider and a phone provider being the two primary choices. Yes, there is Satellite service from Hughesnet which does deliver up to 15 Mbps to most of the country (part of Comcast’s equation) but their plans are almost as restrictive as mobile broadband providers and cost as much as or more than mobile broadband providers. In fact, under Comcast, we could see broadband prices and structures reaching Hughesnet status with data caps (which Comcast has experimented with) and very short term promotional pricing (which they already do), not to mention high prices.
Overall, Comcast is once again trying to bend the truth and ignore the reality of the situation and let’s hope that the FCC sees through their ridiculous perversions of the truth in order to nuke this merger once and for all.