Mt. Vernon Register-News

Opinion

April 10, 2014

Comcast thinks its merger is a gift to us

(Continued)

For example, the company says that getting bigger will help it accelerate its investment in new technology. Maybe. But a bigger buyer of technology, programming and online applications can also exercise monopsony power: A bigger Comcast will be able to persuade cable-box makers, programmers and high-capacity online-application designers to do things its way. That’s not good for competition or innovation.

Comcast promises that current Time Warner Cable customers will gain faster Internet access. Perhaps. But those customers will also have little ability to switch from the Comcast behemoth if they think their service costs too much: The only direct national competitor to Comcast and Time Warner Cable is Verizon Communications Inc.’s FiOS, which overlaps with just 17 percent.

of Comcast’s territory. Comcast touts Google Fiber as a competitor, but if Google continues its current building plans, it will reach just 3 percent of U.S. households. Comcast, in combination with Time Warner Cable, will be poised to sign up two-thirds of American households.

Comcast also says it will help close the digital divide by getting more Americans to sign up for its Internet Essentials package: $9.95 a month for a 5 Mbps Internet connection. This is perhaps the most cynical of the company’s public-interest gifts: If you are now a Comcast customer, in order to get the reduced rate, you have to first drop your subscription for 90 days. You also have to have a child in a reduced-price school lunch program and fill out a lot of paperwork. Thanks to these barriers, the program has attracted just 9 percent of eligible families in Philadelphia, Comcast’s home territory, and just 12 percent nationwide.

Scale may be good for Comcast and Time Warner Cable’s ability to squeeze everyone else. But that will do nothing for the public interest.

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