Comcast is pissed. Per the FCC's latest vote, it can't provide cable to more than 30 percent of the country. It has a 27 percent market share right now with 26.2 million subscribers. With the FCC's 30 percent market cap, it can add fewer than 3 million new subscribers before it hits the wall, pretty much ruling out acquisitions of other cable companies or any major growth.
FCC Chairman Kevin Martin's proposal to limit the growth of cable providers had been floating around for a bit and was sort of expected not to fly, but two of the four other commissioners have thrown in with him on the vote. It's possible—if not probable—that the courts could get involved and throw out the decision, which Reuters points out they did six years ago.
The final vote's expected to go down sometime before Dec. 18—so the two commissioners have time to change their mind—but Comcast will probably start rabble-rousing long before then. They're probably already in the vicinity anyway, going on about the FCC's decision a few weeks ago killing apartment-exclusive contracts. All in all, quite a beating for cable from the FCC this month. [WSJ, Reuters, Flickr]









Comments
Good. Comcast is a terrible country.
too bad i dont have a couple million friends i could ask to sign up with comcast... i would love to see anyone take that company down.
Boohoo comcast wants a monopoly, er rather a bigger monopoly than than have already. Let me think, what broadband choices do I have in my Boston neighborhood? Well there's comcast, and um, hmmm comcast and oh yeah there's comcast. And the no compaction expensive service is anything but comcastic. I never thought I'd say this but - GO FCC!
"Um, hi, I just moved to town and I'd like to sign up for cable."
"Yeah. No can do."
"Excuse me?"
"No go bro. Can't do it."
"What?"
"We just signed up our 29,111,111st customer my man. You'd push us over the edge. Make us a monopoly. I'm out of here."
*click*
"Huh? What just happened?"
Doesn't that ratio change with every subscriber?
I mean if there are 100 million total subscribers divided between three providers then doesn't the ratio change with every new customer? I can see how it would be static if we're talking about just poaching customers from other providers, but what about marketing towards overall growth?.
Also, what happens if (unlikely) one of the major providers goes tits-up?
If 10 million users cease to be users then the total percentage of all subscribers Comcast is selling service to goes up automatically.
Is this just me or is this really confusing?
While I support the idea that Comcast should not have a monopoly, with this in place the only way for Comcast to grow its profits is to raise rates on its existing customers. Unless it's somehow going to make me able to get broadband from somebody other than Comcast, I don't see how this is a good thing for me or the millions like me.
The government sucks! I can't believe they'd try to infringe on Comcast's constitutional right to ever-growing profits.
Strange, I don't see why they would do that. Comcast isn't a monopoly - there are many alternatives like DirecTV, Dish, local cable companies, and more.
What I could see comcast doing is eliminating service in less-profitable areas to target higher profitable areas.
This will fail though.
Cable is a major failure of the federal government since states are allowed to control access (or in many cases, the states delegate to municipalities). Instead of forcing new cable competition to negotiate for access into local markets, the FCC should just grant federal licenses to provide access to all markets, similar to how New Jersey granted Verizon a "statewide" franchise for Fios instead of forcing Verizon to negotiate with each municipality.
Oh good! Without the added revenue of new subscribers Comcast can just sell us new services and charge us more for existing ones to maintain growth expectations.
Way to go FCC!
Yay!!!! All I can say is that Comcast Sucks!!! Now they get to feel what they've been doing to their customers for a change. If they raise rates, then look for one or more companies to spring up in their place as customers become more and more fed up...Thanks, nice ending to the week...
Yayyy!
I hate comcast. I currently have it but I am switching to AT&T U-Verse next week. I can't take the 44.2kbps upload speed anymore. We've had more problems with comcast.
@teexcue: couldn't have said it better
No problem. Just increase the rates on existing customers to make up for the lack of growth.
I thought I just heard the DirectTV people all have spontanious orgas...
The FCC should tell Comcast they will deliver their decision between 8am and noon. THEN not show up.
Boo Comcast. Boo government intervention.
This is the single instance that I will say I am glad that the FCC exists, other than that, they are helping to make a nation of pussies.
Personally, I'm waiting for options outside of Comcast in my neighborhood. I'm sick of this monopoly.
This is horrible news for Comcast customer service (yes, I know what the meaning of oxymoron is); they will be able to give even less crap about disgruntled customers - those are going to be replaced much more easily, since the market is artificially kept from being saturated with Comcast's service.
@fusiongt: The so-called "anti-monopoly" laws are kind of misnamed. They work to protect against the kind of anti competetive environment that can exist when a limited number of companies control an overwhelmingly dominant portion of a given market.
When they were first enacted they were in great measure a response to the railroad companies. There were, as in the case of Comcast/D-TV, etc, more than just one RR company, but they were able to stifle investment in other alternatives because they controlled so much of the market from production to use.
Of course it's up to lawmakers to decide what it an inappropriate measure of influence. It looks like they have done so in this case.
@CaliforniaKid: Classic! Kudos to you, sir.
And I hope it helps drive down these damn prices! Just moved to Atlanta from St. Louis and I tried to get DIRECTV, but I've got a friggin tree that makes me not eligible for satellite TV - and I don't think there's anybody other than Comcast in Atlanta, so the guy is coming out tomorrow to screw my cable box in and then screw me to the wall. :(
@shorty63136: charter is available in some parts of atlanta, i believe.
@conglomerate:
If he has Comcast, then most likely not in his area. Cable companies run their business like the mafia. #1 rule: don't piss on someone else's turf.
There's only one cable company allowed in an area at a time, and they'll all do anything possible to prevent anyone else who might pose a threat to their organizations bottom-line from moving in.
I'm no Comcast lover, although I am a subscriber and like most people I feel like they should be providing better service for what feels like a lot of money. However, it feels like the FCC is out to get them, or more specifically me! First the cable-card thing, forcing them to not use the old boxes - which would be perfectly fine for most people. That decision means new equipment purchases for Comcast - and they will gladly pass the cost on to me. Next Comcast wants to try to compete and get rid of their analog - no go there either, that I'm sure will translate to higher fee's and slower addition of services and bandwidth that I'd love to have. Now this FCC decision, last time I checked economies of scale work - just ask Walmart. The more subscribers Comcast has, the better deals they can make on hardware and content deals. All this said, I'm still contemplating a switch to DirectTV for their HD content, but truth is Comcast gives me a better deal with low cost rental of dual tuner HD DVRs, as many as I want - not just one like sat. Fios, supposed to be soon, I'd like to give them a try IF they ever get to my street - but their HD situation is no better than Comcast at the moment. I'm just not sure the FCC is doing much for the consumers here, what the heck are they trying to do anyway?
this is fine. With comcast's quality, all of their users that know better will leave soon enough.
If Comcast is capped at 30 million (btw, so will all the other cable providers) then this should open the door for NEW cable companies to spring up right along side Comcast, offering competition to a company which has allowed its "absolute power" to corrupt it "absolutely".
I applaude this FCC decision, and hope it STICKS. Let's ALL start STICKING it to companies that don't operate by centuries old American standards and expectations. I'm F!+"ING SICK AND TIRED OF THE ABUSE I'VE SUFFERED HERE TODAY. THE ABUSE I'VE SUFFERED WON'T SOON BE FORGOTTEN, NO, IT....
Ok, ok, we get it, I like Family Guy....
I have to say, that as much as I don't like comcast, this law is a little unfair when you consider the fact that Comcasts rivals like Dish, Direct tv, at&t, verizon and all the rest have no such "wall" that they have to be worried about. It just tips the ball a little too much in the telecos favor. Almost like Comcast is going into a boxing match with a straightjacket on.
I think this limit should be per county or city not country wide. this still leaves rooms for regional monopolys which in my opinion is not any better. The FCC is not very smart when it comes to this stuff.
@ryan: For internet, Dish/DirecTV don't really count as competitors. They're worse than Comcast.
finally, hey Mr. Roberts, remember when you screwed me over on my bill and tried to take away the modem I owned, karmic payback is a *****, isn't it?
Back home I have the choice of two different cable companies, and of course a plethora of satellite companies. None of the cable companies are Comcast, Verizon, AT&T. They're Service Electric and RCN. They might be local and have fewer features than Comcast, but customer service is more localized, and I have that extra choice. They both have a huge HD collection and Broadband service, including local phone service and VoIP. They even get the channels that stations fight with Comcast to get.
The long term view here, is a limitation of choice. Is it the fault of Comcast that they were able to secure contracts for coverage areas? I'm imagining this has/will effect(ed) smaller cities. I live in Chicago and have a choice of several companies. In my experience, Direct TV was possibly the worst 4 months of my life. If I compare myself to the rest of the comments, I seem to be the only one satisfied with Comcast. I'm all for encouraging competition but not limiting the choices of the people- this concept by the FCC is a ridiculous band-aid fix to a more deep rooted problem.
I think they should earn their pay, get their elbows dirty and find a better solution.
Many people are saying this could bring about other cable companies to compete with Comcast. Remember that in a lot of cities and municipalities, Comcast owns the cable lines themselves. Other brokers would have to license the right to use the existing lines, or bury (literally) outrageous amounts of money to drop there own lines. The cost of running a telco like Comcast or Verizon is entirely made up in the physical owning and maintenance of the hardlines. That;s where these companies have us by the balls. Ma and Pa Inc. can't just start up their own FIOS or cable service unless they can provide their own lines, or pay the exorbitant fees to use them. Government should work on the fair use and regulation of this aspect, and then the companies could compete based on product and services offered.
is that 30% per volume, because if not, they'd be smart to cut service to all non-dense areas to save on infrastructure and sell the rest off to a small guy for some capital, and just roll around in profit while improving service and become the company everybody wants but cant have.
@CaliforniaKid: Hahaha Classic!
If this cap is by # of subscribers, this would be the perfect chance for people to sign on to whatever bare minimum plan Comcast has to offer to make them feel the squeeze even faster.
Capitalists have just never figured out that eventually you run out of market. (Usually, they sell or get a golden parachute before that happens and it becomes someone else's problem.)
I like comcast and will use no other HSI connection. But the going rate at other cable companies for the level of service i have, are almost exactly the same. So basically in the future, someone needs to access the internet, they call comcast: Im sorry, we have reached our max, you have to wait until someone cancels before we can set you up...thats ridiculous
Mmm...So the FCC favored in Verizon/AT&T hands so when Comcast is gone, they take over.
In goes crap out goes crap..repeat.
hmm..thier stock is up 4.82% so far today.
[finance.google.com]
Maybe not so bad news?
Let's not pitty them; Comcast has more power over this than they realize. If they put bandwidth caps on their high speed internet users the FCC "technically" has the right to do this to their business as with any business (ma-bell and satellite companies). On the flip side, however, mega operators have their own network and a huge subscriber base. It's only a matter of time before they figure out how to inundate viewers with on-screen bugs, text crawls, ad insertion, and perhaps even a free channel that preaches the Comcastic way. This can be used to their advantage much like the way MTV herds first time voters to engage politics they know very little about just so they can be "cool" being someone who can vote.
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