FCC Approves Nightmare Cable Super Merger

Image via Getty
Image via Getty

America’s long national cable company horror show is far from over. In fact, it just got a lot worse because the Federal Communications Commission has officially approved the Charter-Time Warner Cable merger.

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As Gizmodo previously reported, the deal will bring together Charter, Time Warner Cable, and Bright House—the fourth-largest, second-largest, and tenth-largest cable companies in America, respectively. If it wasn’t apparent, this is great for the companies, but very, very bad for consumers.

According to the FCC’s press release, the deal was approved yesterday “with conditions.” FCC Chairman Tom Wheeler had previously proposed conditional approval, including stopping Charter from tacking on usage-based pricing for broadband service and charging companies like Netflix and Amazon money for their bandwidth use. Those caveats, however, are only in place for seven years after the merger. The press release noted that details regarding these “conditions” will be released “in the coming days.”

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While the merger has its fans (like Tom Wheeler, for example), it also has its detractors, including FCC member Ajit Pai, who voted against the merger.

“The FCC’s merger review process is badly broken,” a spokesperson for Pai told The Hill. “Chairman Wheeler’s order isn’t about competition, competition, competition; it’s about regulation, regulation, regulation ... It’s about imposing conditions that have nothing to do with the merits of this transaction. It’s about the government micromanaging the internet economy.”

This is not an unfair accusation, as the merger will very possibly kill competition and thereby fuck up the quality of service for millions of customers. According to The New York Times, the resulting company would become America’s second-biggest broadband provider after Comcast. (Don’t forget that Comcast and Time Warner Cable also attempted a merger recently, which ended in failure.)

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The Charter-Time Warner Cable deal has already been approved by the Department of Justice, but according to Bloomberg, the deal must still receive approval from California, whose Utilities Commission may vote on it as early as May 12th. (It must receive approval in California because it will affect customers there.) Given that an administrative law judge has already given it the thumbs up, however, things look to be leaning in the direction of approval.

Letting a cavalcade of cable companies join forces into one enormous three-headed cable monster is never a good idea, but unfortunately, it looks like it’s going to happen.

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[Bloomberg]

Sophie is a former news editor at Gizmodo.

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DISCUSSION

subtlequeues
subtlequeues

I’m fortunate to be in an area where we have three companies (2 cable and 1 fiber) competing with each other for my business, and my rate comes in at ~$35/mo for 20Mbps service. The bill will tend to increase but when it gets too high I can switch to another provider to get a new customer discount (and last time I tried to switch, my current provider called and gave me a better rate).

On the other hand, in my hometown, my family is stuck with Time Warner exclusively. My mom’s bill has gone up to a shocking $80 for similar service. She can go down to “basic service” at around 10Mbps to get her bill down to something like $75. The only competitor is some DSL service that offers 1.5 Mbps at at $50/mo, which is nearly worthless and over-priced. The only advice I could give her was to threaten to switch to the DSL, but then if they called her bluff she’s screwed, and is going to have to go back to getting cable TV since she wouldn’t be able to stream at that rate. She lives in a medium-sized city, not some out-of-the-way place in the country. It is a literal monopoly and I don’t understand how this system is still in place.

The FCC ought to be expending its influence in this merger to correct these market-strangleholds.