Late last night, news broke that Comcast is buying Time Warner Cable, a company that was recently spun off from its Time Warner media conglomerate parent. The two companies rarely compete against each other because cable television distributors, also known as MVPDs, operate as regional monopolies. Moreover, cable television companies see as competitors over-the-top services, such as Netflix and Hulu. They insist that while there will be fewer firms in the MVPD space, there will still be plenty of competitors in the TV distribution space.
This merger might be about getting MVPDs having better leverage during retransmission disputes. But the masterminds behind this acquisition wouldn’t be earning their money if they weren’t aiming to consolidate broadband Internet access. Free Press points out that “Comcast is the country’s #1 cable and Internet company and Time Warner Cable is #2. Put them together and you get a single giant controlling a massive share of our nation’s TV and Internet-access markets.” It’s hard to imagine that they wouldn’t put the squeeze on those same over-the-top services that they see as competitors.
We need to keep the pressure on regulators to impose net neutrality–type restrictions on these broadband providers. Or regulators can block the merger altogether.