Washington Consumer Groups Question Comcast’s Reported Bid for Time Warner Cable

A report that Comcast is considering bidding for Time Warner Cable drew immediate concerns from consumer groups in Washington, who worry that a combined cable behemoth could raise prices to consumers, reduce their video choices and potentially eliminate the web as a competitor. The consumer groups suggested that such a deal would likely violate both antitrust and federal communications laws.

“Already you can’t launch a new channel without Comcast,” said Matt Wood, policy director for Free Press, a consumer group active in media consolidation fights. “This would give them so much more power.” Wood said a Comcast purchase would also reduce “the chance of effective competition” to cable from Internet video sources.

Mark Cooper, research director for the Consumer Federation of America, said a Comcast purchase would effectively create a cable “monopsony,” giving Comcast control not only over which cable channels are successful, but access to the web in parts of the nation. “They would have sufficient share that their buying practice could disrupt the market,” he said. A channel that couldn’t get on Comcast wouldn’t be able to survive. “This is a merger that raises fundamental Communications Act and Sherman Act issues,” he said referring to laws overseen by the Federal Communications Commission and the Justice Department, respectively. “There is no avoiding it.”

Both questioned whether a Comcast purchase would pass regulatory muster.

(Nov 22)