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So Comcast, in a sort-of surprise, is going to end up buying all of Time Warner Cable for itself.

If you are a regular person, and you hear that the biggest cable company in the country is going to buy the second biggest cable company in the country, your reaction is probably something along the lines of this:

And you might also wonder if regulators are going to do anything to stop it. After all, didn’t the feds stop AT&T from buying T-Mobile a couple years ago?

You’ll hear a lot more about this tomorrow, first from Comcast* and Time Warner Cable, who will officially announce/defend their deal, and then from people who can talk about this stuff with sophistication, like my colleague Amy Schatz.

But for now, you get me, typing it out slowly.

So here’s the big idea that’s supposed to get the deal approved in the coming months: It’s okay for a giant cable company to buy another giant cable company, because cable companies don’t compete.

For instance: I live in Brooklyn, and I’m a Time Warner Cable customer. In theory, I could also get TV from the satellite guys, and also from Verizon. But I can’t get TV from Comcast, because the cable guys work in specific territories, carved out by local regulators, and they don’t overlap.**

Assuming the deal goes through, it’s not going to reduce my (limited) choices. I’m just going to start writing checks to Comcast instead.

And that’s about it. You’ll hear more tomorrow about Comcast’s increased leverage with programmers, and better technical facilities. And Comcast is going to make some moves to appease the feds from the get-go, like selling off 3 million of its subscribers to other cable operators, which would mean it ends up with 30 million subscribers total.

And maybe regulators will give this deal more scrutiny than Comcast expects, so you might see other concessions.

But even though this one sounds like a huge deal — $44 billion does tend to sound huge — it’s hard to see much changing for consumers any time soon. Which is why Comcast thinks it will get done.

* Comcast owns NBCUniversal, which is an investor in the company that owns this website.

**Recall that a few years ago, the feds blessed a peace treaty between Verizon and Comcast, who actually are competitors.

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8 comments
hindsight
hindsight

Is it even possible that Comcast will be able to do this? There has to be a ton of money and influence being pumped into Washington for something like this to even be contemplated. How brazen can Comcast be? This is so wrong that it just might be a looked upon in history as a criminal act.

phil28
phil28

It's not about which cable company we as consumers can use, it's about the huge clout Comcast will now have with the content creators that span Netflix to Disney to small independent producers. Not only do they compete with these creators as owners of NBC, but they can determine what each will pay and their download speed,  and will now control access to their customers. 

It's is as if GM built owned the Interstates and allowed Chevys to travel in the HOV lanes and never pay a toll. This is so wrong on so many levels, that this piece seems to trivialize its impact.

mknopp
mknopp

I have echo the sentiments. This (the problem with the deal) has almost nothing to do with their cable business and almost everything to do with their internet business and their increased clout in suffocating the natural move from the old cable model of business for shows to the new internet based model of business for shows.


In other words, this is bad for consumers all around and it is bad because of things that have nothing to do with who your cable TV provider is.


Now, if Comcast wants to divest itself of its ISP and content creation businesses, then I think it could be considered. Otherwise, this is a EXTREME conflict of interest in the making instead of just a huge one that exist right now.

Steve Johnson
Steve Johnson

Yeah, gotta echo JeffInLondon. The competition is not for consumers but content providers. If they are the gateway for content providers to get to the NYC AND the LA markets, they have tremendous bargaining clout against NetFlix or Hulu or Apple or anyone else that wants to provide programming to those key markets. And remember they also own NBC Universal and produce a lot of content, so being able to get new shows on in NYC and LA is a big advantage versus other content producers.Here's a good map that shows who is where.: http://www.fcc.gov/maps/connect-compete-home-broadband-coverage-map


Mergatroid69
Mergatroid69

Comcast + TWC = The Worst of Both Worlds...

davidamodt
davidamodt

The only ones who win are the CEO's and possible shareholders in the companies. The customers unfortunately are always the ones who suffer with decreased service and higher prices. 

JefinLondon
JefinLondon

In each market there is no competition, but this sure give them monopoly market power over content providers. 

phil28
phil28

Of course the press and public have it all wrong, at least according to this former Vice President and Senior Vice President at Cablevision Systems:

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