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Can Cable Competition Possibly Get Worse?

2014-02-18 09:48 by
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The announcement of the eventual merger between Comcast and Time Warner Cable last week raised concerns about the competition in the U.S. cable industry. The broadband industry is already so non-competitive that once upon a time regulators would have been trying to break up the deal.

The real threat is that the Comcast-Time Warner overlords will control what streams through their cables. It might already be happening. Netflix CEO Reed Hastings has accused Comcast of squeezing streamed Netflix content. It's hard to prove, but many of Comcast's customers report odd hiccups and delays while watching Netflix.

If the deal becomes a fact, the resulting company would have at least 30 million cable customers, just under 30 percent of the TV market, as well as 38 percent of high-speed Internet customers. It will have virtual monopoly cable control over news and public service programming in cities like Chicago, Los Angeles, Philadelphia, New York City and Washington, D.C. It will be able to exact price concessions from content providers, forcing some out of business, limiting innovation and variety.

However, Comcast claims that the combination of the number one and number two cable companies will somehow enhance rather than diminish competition and lead to greater consumer satisfaction.

"It will not reduce competition in any relevant market because our companies do not overlap or compete with each other. In fact, we do not operate in any of the same ZIP codes."

Read more -here-


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