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Whatever happened to that Time Warner / Comcast merger?

February 23rd, 2015


Rarely does Comcast go a week without some sort of negative news, but one bit of press has been consciously absent from the headlines recently, especially when considering how huge of a story this was just 365 days ago: That little merger between Time Warner and Comcast. With the deal clearly stalled in the FCC, and other issues even taking precedence over the deal (Net Neutrality vote this month).

When Comcast announced over a year past that its intention was to merge with TWC, it looked like a foregone conclusion that the deal would go through.

At the time, the regulatory process for mega-mergers like these was essentially a rubber stamp. Yes, the  FCC did some due diligence and waited a few months for appearances, but the agency was seen as greatly favoring the industries it regulates.

Hopes for the deal were further buoyed by the fact that former cable lobbyist Tom Wheeler chairs the FCC and seemed unlikely to get in the way of his former employers. The deal, which would combine the two largest cable operators in the country, might have outraged the public, but popular opinion has never been a major driving force when it comes to federal regulators approving (or disallowing) mergers.

Surprisingly, Wheeler has again proven to be anything but a lobbyist-lackey. The chairman has taken stands on a number of issues that were not popular with the cable and wireless industries that fall under FCC regulation:

  1. He made it clear he would not allow a merger between Sprint and T-Mobile as he does not believe shrinking from four major wireless carriers to three was good for the country.

  2. He announced plans to regulate Internet service providers under Title II of the Communications Act.

Perhaps most importantly, Wheeler has shown a willingness to be moved by public opinion, for better or for worse.

Oliver basically said the public was not outraged about net neutrality, because the topic was so boring nobody understood it. This, he explained, allowed Wheeler and the FCC to pass rules that were good for ISPs and bad for consumers.

While Wheeler could have taken offense or simply ignored the viral outrage, he instead took it to heart. Millions of comments were made on the FCC website regarding the merger — some by activists with a clear agenda but also many by regular consumers who felt uneasy about allowing one company to control roughly 35% of broadband Internet service coverage and just under 30% of U.S. pay television subscribers.

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