Cable TV's antitrust issue
[Commentary] Rapid technological advances have helped cable TV operators become the country's leading providers of broadband Internet connections. Yet "cable modem" service poses an existential threat to the pay-TV business that has been cable's bread and butter since its inception. Low-cost online movie and television services from the likes of Netflix and Hulu are slowly drawing customers away from cable's ever-more-expensive bundles of channels.
So when leading cable TV operators started penalizing customers who downloaded unusually large amounts of data — a practice that seemed to target the heaviest users of online video services such as Netflix — it raised a troubling question: Are the penalties a legitimate effort to reduce congestion and offer a better online experience for most cable modem customers, or just a pretext to hamper cable's online rivals? That's the backdrop for a new inquiry launched by antitrust enforcers at the Justice Department. Cable operators have the right to compete aggressively, but not to use their power in the broadband market to compete unfairly for video customers. We welcome the Justice Department's efforts to determine whether the cable companies' practices are just aggressive or unduly discriminatory.
Cable TV's antitrust issue