Over a dozen opponents to US cable giant Charter Communications’ planned US$56bn merger with Time Warner Cable and Bright House Networks have formed a coalition to raise awareness about the deal’s threat to cable TV and broadband markets. The Stop Mega Cable Coalition argues that the deal would create a duopoly in the high-speed broadband sector and stifle competition in other areas.
Over a dozen opponents to US cable giant Charter Communications’ (NASDAQ:CHTR) planned US$56bn merger withTime Warner Cable (NYSE:TEC) and Bright House Networks have formed a coalition to raise awareness about the deal’s threat to cable TV and broadband markets.
Launched today, the Stop Mega Cable Coalition, whose members include Dish Network (NASDAQ:DISH), Cincinnati Bell (NYSE:CBB), FairPoint Communications (NASDAQ:FRP), trade body USTelecom and public interest groups, said in a statement that their chief concern is that the merger would form a “mega cable” company which would create a high-speed broadband duopoly with Comcast.
They argue that this could lead to “stifled competition from innovative streaming services, decreased opportunities for independent, diverse programmers, reduced competition across a range of related technologies, and increased costs for consumers”.
Gene Kimmelman, CEO of advocacy group Public Knowledge, a coalition member, said: “This proposed transaction would create strong incentives for Charter and Comcast to coordinate their treatment of video programmers and broadband video distribution in ways that could damage competition and harm consumers.”
The coalition has called on the FCC and DOJ to “solve” what they consider “substantial harms”.
Dish deputy general counsel Jeffrey Blum commented: “It feels like Groundhog Day with yet another mega cable merger threatening to consolidate too much of this country’s high-speed broadband connections, all to the detriment of competition and consumer choice,” adding that the deal is also a threat to OTT services, which need robust broadband connections.
Charter, by contrast, argued in its public interest statement for the deal that customers of the combined company, New Charter, would benefit from faster, more affordable internet and a quicker rollout of advanced technology, among other things.
John Malone-backed Charter agreed to buy TWC and Bright House for US$56bn and US$10.4bn respectively in May 2015. The deal, which would create the country’s second largest cableco behind Comcast, secured the approval of the New York State Public Service Commission (NYSPSC) earlier this month. However, it still needs clearance from federal regulators as well as authorities in California and New Jersey.
On 4 January, the FCC paused its 180-day informal time clock for its review for 15 days, until 20 January. The commission said it received numerous supplementary materials from Charter, TWC and Bright House owners Advance/Newhouse, which it needs extra time to review.