EDITORIAL: An unholy telecom power?

The Fresno BeeFebruary 14, 2014 

If you hate your cable company, then get ready to loathe the $45 billion merger of Comcast and Time Warner announced last week.

Not because it limits direct competition. If only. That battle was lost long ago.

No, what is troubling about the prospect of the nation's two largest telecommunication operators melding into a single media megalith is the power it concentrates in just a few hands — the power to decide what we view, when we view it and how we view it; the power to shut out content providers the company doesn't like or those that are direct competitive threats; the power to charge more money but provide less service; and, most worrisome of all, the power to put a chokehold on our open Internet.

To say it simply, the prospect for cable consumers is this: "Higher prices; worse service," as Sen. Al Franken summarized the deal to a CNN reporter Thursday. He was not joking.

When federal regulators and lawmakers assess the merger proposal in coming months, they should apply a broader test than the traditional definitions of competition. But more important, they should consider the potential threat this deal may have on the nation's broadband Internet users.

Together Comcast and Time Warner serve about one-third of the entire U.S. market, about 33 million subscribers. California is a big piece of the pie, including most of its major cities and 3.7 million Internet subscribers, or about 25% of the state's households, according to Sunne McPeak, president and CEO of the California Emerging Technology Fund.

McPeak is worried about this deal, not because she fears "Duck Dynasty" might be squeezed off the air. She has been fighting to bridge the digital divide in California involving about 25% of residents. This will not help her cause, as the two companies have dismal track records reaching and serving low-income or immigrant homes.

"In California and across the nation, Comcast has reached less than 10% of eligible participants because they have not made sufficient investment in community partners to inform consumers," McPeak said in a statement. "Time Warner has an even more embarrassing performance ... far below 1%."

For consumers, the real threat is that the Comcast-TimeWarner overloads will start to exert control over what streams through their cables. These aren't just the paranoid fantasies of those who have watched "The Matrix" too many times. Comcast and Time Warner have been involved in efforts to subvert content to their customers.

Netflix CEO Reed Hastings has accused Comcast of squeezing streamed Netflix content. It's hard to prove, but many of Comcast's customers have reported odd streaming hiccups when they watch Netflix that don't occur to other media sources.

And the Time Warner blackout of CBS and Showtime last fall in Los Angeles, Chicago and New York was well-documented. The two companies were wrangling over transmission fees.

This doesn't bode well for good service. When the Federal Communications Commission evaluates whether this deal is in the public's best interest, it must use this as an opportunity to truly represent customers, not act as the rubber stamp for the telecom industry as it did under former Chairman Michael Powell.

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