Comcast, Time Warner Agree to Merge

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psydude: Apr 1, 2008

Comcast, Time Warner agree to merge in $45 billion deal

I did my best to pare it down, but basically everything in the article is important.

quote:

Comcast�s $45 billion bid for Time Warner Cable would create a cable television behemoth in an industry that has steadily increased prices for bundles of channels and services that many consumers dislike but feel forced to buy.

But the merger would have far greater implications for the future of media and communications, with one firm controlling more fast Internet lines into American homes than any other company, along with a huge swath of content through its ownership of NBC Universal.

The combined company would have 33 million cable subscribers and nearly as many broadband users, giving it enormous power in negotiations with networks over licensing fees and in determining what shows reach consumers on mobile devices, laptops and television sets. It could influence whether the next Apple TV or Google device gets a fair shot at replacing cable set-top boxes. Without the second-biggest cable company to help keep pressure on prices for triple-play television, Internet and phone service, Comcast would have flexibility to set the market rates.

The expansion of Comcast�s footprint in the United States would give it greater control of lines known as the �last mile� into homes and businesses, infrastructure that has increasingly become like a utility for consumers who look to the Web for entertainment, education and communications. The company said it would not block competitors on its network or deliver its own video products with better quality than a competitor such as Netflix. Comcast does not overlap with Time Warner Cable in any cities, which means it would not eliminate competition, the firms said.

...

Consumer groups, lawmakers and unions have criticized the proposal, saying it could send many consumers back to the monopoly phone era, when Ma Bell set prices and controlled the kinds of phones consumers were allowed to use.

�This is the future. Comcast is in the driver�s seat on how to define how Internet-enabled equipment, software and applications touch consumers,� said Gene Kimmelman, president of the consumer advocacy group Public Knowledge and a former antirust official at the Justice Department. �And everyone in programming and the television ecosystem will need to be in front of Comcast customers, so they will have to adjust their specifications for Comcast.�

To head off regulatory concerns, Comcast offered to shed 3 million subscribers to keep its ownership of the entire cable marketplace below 30 percent, a figure that television programmers say is the threshold for competition in licensing negotiations.

The company said it is confident it will win regulatory approval because it and Time Warner have no overlapping customers. Time Warner Cable subscribers are in the New York tri-state region and in Southern California, Texas, the Carolinas, Ohio and Wisconsin. Time Warner does not serve the D.C. area. Comcast serves the District and its Virginia and Maryland suburbs.

The merger would build on Comcast�s strategy to transform itself from a cable television business into a broadband and media powerhouse. The company has experienced a slow but steady decline in cable television subscribers as consumers increasingly turn to broadband Internet services for entertainment and communications. Netflix, with 31 million subscribers, has exploded in growth while using as much as one-third of bandwidth on broadband networks during peak hours.

Comcast will argue to regulators that the cable market is fiercely competitive, with new rivals among online video providers such as Hulu, and from television and broadband Internet �providers such as Verizon�s Fios service and Google with its experimental ultra-fast fiber network in a few small cities.

�We believe the transaction will bring pro-consumer benefits,� Comcast chief executive Brian Roberts said in a call with reporters. �That�s because we have no business overlap, so there�s no reduction in competition.�

...

In total, the company said the merger would help reduce costs, or lead to �synergies,� which it estimates at $1.5 billion in operating efficiencies a year.

Analysts generally agree that Comcast is likely to win approval for the merger from antitrust regulators. The lack of overlapping markets means regulators won�t view the proposed merger with the same concerns as in AT&T�s proposed bid for T-Mobile, experts said. That deal, which regulators rejected, would have eliminated a major national carrier and given consumers fewer options.

When it acquired NBC Universal in 2011, Comcast agreed to �net neutrality� conditions that prevent it from prioritizing its online content over a competitor such as Netflix. Comcast is expected to offer similar restrictions in its proposed merger with Time Warner Cable.

Comcast said it expects to win approval within nine to 12 months.

...

�The problem for regulators is clear. Programmers will claim that a merged [company] would simply be too large to be allowed,� wrote Craig Moffett, the head of research firm MoffettNathanson. �From a First Amendment perspective, they will argue that it is simply a bridge too far.�

...

But analysts also note the company�s powerful lobbying operation in Washington. It won approval for the NBC Universal deal even with major protests from consumer groups and some lawmakers. In 2012, a Comcast deal to sell spectrum to Verizon and to cross-market products was approved even though some analysts said the agreement effectively stopped competition between the firms.

David Cohen, Comcast�s executive vice president, is a longtime Democratic insider who has held fundraisers for President Obama and the Democratic National Committee. This week, he and his wife attended the White House state dinner for the president of France.

Said Jeffrey Silva, an analyst at Medley Global Advisors: �Comcast has a strong track record on transactions pursued during the Obama administration, and we believe the company is quite capable of once again negotiating a successful path forward on this deal.�

TLDR: Comcast and Time Warner are proposing a merger that will give them around are 30% share of the market. Comcast claims that this will give them leverage to deal with programming companies (for television) and do "synergize" various sectors of the industry to drive down costs. Comcast has made a pledge to support network neutrality in the past when it acquired NBC and claims that FiOS and Google Fiber provide sufficient competition in the marketplace. Consumer rights groups point out how this will give Comcast a "Texas Textbooks" influence on multiple sectors, basically allowing them to dictate standards for hardware and services as well as control market rates charged by Tier 2 and 3 service providers.

I think we're definitely headed toward another national telecom monopoly here, just like AT&T and Bell before them. And while I really don't give a poo poo about cable television, the implications for media control and the obvious threat to net neutrality are worrisome. I know that, at least in the Mid Atlantic, Comcast has managed to stamp out almost all local competition. At this point you're basically left with Verizon, Cox, and Comcast, with Cox servicing a much smaller area.

# ? Feb 14, 2014 11:57

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# ? Apr 28, 2024 20:27

beejay: Apr 7, 2002

Despite their talk about how this is good for consumers and they will reduce costs and poo poo, don't be fooled and think that this would do anything to lower prices for the consumer.

http://arstechnica.com/tech-policy/2014/02/comcast-no-promise-that-prices-will-go-down-or-even-increase-less-rapidly/

quote:

"The impact on customer bills is always hard to quantify. We're certainly not promising that customer bills are going to go down or even increase less rapidly," Comcast Executive VP David Cohen said in a conference call today in response to a question on price. "Frankly, most of the factors that go into customer bills are factors beyond our control."

# ? Feb 14, 2014 14:32

HalloKitty: Sep 30, 2005; Adjust the bass and let the Alpine blast

"Frankly, most of the factors that go into customer bills are factors beyond our control."

Like the price of luxury yachts? Better crank up those bills for the CEO to afford a new Ferrari, too!

# ? Feb 14, 2014 15:06

psydude: Apr 1, 2008

The profit margin on bandwidth is ridiculous. I'm not really buying their argument.

# ? Feb 14, 2014 15:19

Bob Morales: Aug 18, 2006; ~~Just wear the fucking mask, Bob~~

I don't care how many people I probably infected with COVID-19 while refusing to wear a mask, my comfort is far more important than the health and safety of everyone around me!

Wasn't Charter rumored to buy Comcast a few weeks ago?

# ? Feb 14, 2014 15:20

Ignoarints: Nov 26, 2010

Time Warner is the only cable company I've had stereotypical comedy-style interactions with.

Just a month ago they gave me a 3 day, 24 hour time frame to have a technician screw in the cable going into my apartment. If I missed it, I'd have to wait until next week. This is only because they cancelled my original two appointments for "reason: none! I can't believe there is no reason in the system sir this is highly unusual"

I have extreme patience for things like that if only as a frame of mind to get what I want faster, but that made me laugh a lot.

save us google

edit: Also everybody is worried but I have a much more pessimistic view. They were already "working together" in the sense of mutual inflation of costs. Could it get worse? Of course, but it's already been happening.

(I paid $15 a month for 100 mbit down and 100 mbit up in south korea :x)

Ignoarints fucked around with this message at 15:43 on Feb 14, 2014

# ? Feb 14, 2014 15:30

computer parts: Nov 18, 2010; PLEASE CLAP

Ignoarints posted:

edit: Also everybody is worried but I have a much more pessimistic view. They were already "working together" in the sense of mutual inflation of costs. Could it get worse? Of course, but it's already been happening.

(I paid $15 a month for 100 mbit down and 100 mbit up in south korea :x)

No one cares about uplink unless you have a server at home (which is the one thing Google Fiber explicitly prohibits).

# ? Feb 14, 2014 15:47

beejay: Apr 7, 2002

Bob Morales posted:

Wasn't Charter rumored to buy Comcast a few weeks ago?

Charter was trying to buy Time-Warner. Word is that Charter was offering to sell some of Time-Warner to Comcast after that deal was done, but then Comcast was like nah, we'll just take it all. Time-Warner rejected the Charter deal and Comcast offered the same price and got it.

http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-comcast-charter-20140213,0,3512470.story#axzz2tJ9lWD2W

# ? Feb 14, 2014 15:50

HalloKitty: Sep 30, 2005; Adjust the bass and let the Alpine blast

computer parts posted:

No one cares about uplink unless you have a server at home

Not even true. Uploading YouTube videos, for example, backing up your personal data to an online service (extremely popular now, and I'd do it if I had amazing upload), online gaming, streaming, etc.

Good upload speed is one thing I'm really sad isn't more widespread.

# ? Feb 14, 2014 16:00

computer parts: Nov 18, 2010; PLEASE CLAP

HalloKitty posted:

Not even true. Uploading YouTube videos, for example, backing up your personal data to an online service (extremely popular now, and I'd do it if I had amazing upload), online gaming, streaming, etc.

Good upload speed is one thing I'm really sad isn't more widespread.

Online gaming is perfectly fine with low speeds.

And you especially don't need 100mbit speeds for it.

computer parts fucked around with this message at 16:04 on Feb 14, 2014

# ? Feb 14, 2014 16:01

psydude: Apr 1, 2008

HalloKitty posted:

Not even true. Uploading YouTube videos, for example, backing up your personal data to an online service (extremely popular now, and I'd do it if I had amazing upload), online gaming, streaming, etc.

Good upload speed is one thing I'm really sad isn't more widespread.

Traditionally, upstream was kept lower relative to downstream just because there were limited frequency bands on the wire and people use downstream bandwidth more often. These days, there's basically no excuse not to have symmetric lines.

# ? Feb 14, 2014 16:05

Bob Morales: Aug 18, 2006; ~~Just wear the fucking mask, Bob~~

I don't care how many people I probably infected with COVID-19 while refusing to wear a mask, my comfort is far more important than the health and safety of everyone around me!

computer parts posted:

No one cares about uplink unless you have a server at home (which is the one thing Google Fiber explicitly prohibits).

Right, that's why my 12mb/768k DSL package was such an awesome deal.

# ? Feb 14, 2014 16:06

computer parts: Nov 18, 2010; PLEASE CLAP

Bob Morales posted:

Right, that's why my 12mb/768k DSL package was such an awesome deal.

It's better than what I have, so yes?

# ? Feb 14, 2014 16:18

gohmak: Feb 12, 2004; cookies need love

Get ready for 300GB/ month data caps. Atlanta started 3 months ago and it blows to have to keep monitoring your usage and end up cutting the modem power 5 days from the end of the month so you don't end up paying ridiculous overages.

# ? Feb 14, 2014 16:33

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

psydude posted:

These days, there's basically no excuse not to have symmetric lines.

Except docsis isn't symmetric. The standard itself has higher downstream than upstream. You would have to dedicate more channels for upstream then you have for downstream.

Also pretty much every cable modem allows for way more downstream channels than upstream.

Don Lapre fucked around with this message at 16:40 on Feb 14, 2014

# ? Feb 14, 2014 16:37

The_Franz: Aug 8, 2003

computer parts posted:

No one cares about uplink unless you have a server at home (which is the one thing Google Fiber explicitly prohibits).

No, you don't care about uplink, but anyone who uploads HD videos, does offsite backups or otherwise transfers large files would love faster upload.

Last month I shot some video and had to transfer it to someone else over a VPN with my lovely 1Mbps upload. It took almost 18 hours to move a little over 7.5GB of data. I could have gotten in the car and made the 800 mile round trip faster than transferring it via the internet.

# ? Feb 14, 2014 16:48

psydude: Apr 1, 2008

Don Lapre posted:

Except docsis isn't symmetric. The standard itself has higher downstream than upstream. You would have to dedicate more channels for upstream then you have for downstream.

Also pretty much every cable modem allows for way more downstream channels than upstream.

Yeah, I should have clarified that I was speaking about fiber.

# ? Feb 14, 2014 17:08

Dr. Jackal: Sep 13, 2009

Comcast itself doesn't make any sense before this anyhow so I bet the regulators are going to bend over happily for this.

I think my favorite part from the USA Today Article is

quote:

In a conference call with reporters, Comcast CEO Brian Roberts defended the deal, calling it "pro-consumer, pro-competitive and strongly in the public interest." He said the deal would benefit millions of customers through technological advancements and innovative products. He pointed out that Comcast and Time Warner Cable don't compete in any of the same markets, adding that the merger won't reduce competition in any relevant market.

like no duh you dumb f***s, you wont share access lines and compete purely on the service level because you guys hate competing.

I really wish the government would split them apart...

# ? Feb 14, 2014 17:12

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

Dr. Jackal posted:

Comcast itself doesn't make any sense before this anyhow so I bet the regulators are going to bend over happily for this.

I think my favorite part from the USA Today Article is

like no duh you dumb f***s, you wont share access lines and compete purely on the service level because you guys hate competing.

I really wish the government would split them apart...

I think its a fair point.

# ? Feb 14, 2014 17:15

nexxai: Jul 17, 2002; quack quack bjork; Fun Shoe

https://www.youtube.com/watch?v=0ilMx7k7mso

# ? Feb 14, 2014 17:32

brothertim: Mar 6, 2013

gohmak posted:

Get ready for 300GB/ month data caps. Atlanta started 3 months ago and it blows to have to keep monitoring your usage and end up cutting the modem power 5 days from the end of the month so you don't end up paying ridiculous overages.

Comcast? Also, do they not grandfather you into it?

# ? Feb 14, 2014 19:14

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

brothertim posted:

Comcast? Also, do they not grandfather you into it?

No grandfathering. 300gb/m. $10 for each 50gb over that. Business accounts do not have the cap.

# ? Feb 14, 2014 19:17

brothertim: Mar 6, 2013

Don Lapre posted:

No grandfathering. 300gb/m. $10 for each 50gb over that. Business accounts do not have the cap.

That's pretty stupid. 300GB can go extremely fast if you spend any amount of time on steam (endless updates). Are they trying to curtail the transition to digital downloading? Most people don't want to leave the house to rent movies/buy games these days.

# ? Feb 14, 2014 22:19

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

brothertim posted:

That's pretty stupid. 300GB can go extremely fast if you spend any amount of time on steam (endless updates). Are they trying to curtail the transition to digital downloading? Most people don't want to leave the house to rent movies/buy games these days.

Yes, they are trying to make it harder to watch netflix/hulu/hbogo/piracy

# ? Feb 14, 2014 22:21

beejay: Apr 7, 2002

The joys of your TV provider having control over your internet. They want you to watch more of their TV and/or use their video streaming, which often doesn't count against the cap whereas Netflix et al do. Cable internet is a great invention but at this point it needs to be separated somehow.

# ? Feb 14, 2014 22:39

brothertim: Mar 6, 2013

And a lot of times you don't even have a choice about which internet provider to use. Unless you live in a major city (and sometimes even then) you're usually restricted to one or two ISPs. Natural monopolies. Like utilities.

# ? Feb 14, 2014 22:44

Wizard of the Deep: Sep 25, 2005; Another productive workday

drat it, I'm tired of calling up my congress-critters to bitch about something terrible about to happen.

# ? Feb 14, 2014 23:47

chocolateTHUNDER: Jul 19, 2008; GIVE ME ALL YOUR FREE AGENTS

ALL OF THEM

Why aren't cable companies allowed over each others lines? I mean, you could get DSL and phone service from multiple companies, why not cable?

Some sort of sweetheart deal they struck with the government about laying down their own infrastructure over the years (which I'm sure was probably heavily subsidized...)?

# ? Feb 15, 2014 00:06

Cenodoxus: Mar 29, 2012; while [[ true ]] ; do
��pour()
done

chocolateTHUNDER posted:

Why aren't cable companies allowed over each others lines? I mean, you could get DSL and phone service from multiple companies, why not cable?

Some sort of sweetheart deal they struck with the government about laying down their own infrastructure over the years (which I'm sure was probably heavily subsidized...)?

Mainly because cable carriers own the entire local loop and hate competitors. It's also tricky (if not impossible) to compete over the same cable infrastructure because cable is a shared medium - one end of the fiber is connected to the CMTS at the cable company's central office, and the other end of the fiber is in a tiny box on your street where it's converted to coax and shared with the entire block.

Phone lines and DSL are a bit different - your phone line is a single twisted pair that runs all the way back to the central office, and it's yours and yours alone. From there, you've got an incumbent carrier that laid the lines or at least has legal possession of them (the ILEC), and you've got competitive carriers (the CLEC) who are given the right to lease lines from the ILEC at fair rates, and either one can take your twisted pair and give you service over it.

Another factor preventing shared cable markets is that many municipalities offer a pseudo-"protected monopoly" status to cable carriers in exchange for the carrier agreeing to provide service to the entire area. The local government gets their constituents internet access, and the cable company gets so many years of almost guaranteed :10bux:

# ? Feb 15, 2014 01:56

chocolateTHUNDER: Jul 19, 2008; GIVE ME ALL YOUR FREE AGENTS

ALL OF THEM

Cenodoxus posted:

Mainly because cable carriers own the entire local loop and hate competitors. It's also tricky (if not impossible) to compete over the same cable infrastructure because cable is a shared medium - one end of the fiber is connected to the CMTS at the cable company's central office, and the other end of the fiber is in a tiny box on your street where it's converted to coax and shared with the entire block.

Phone lines and DSL are a bit different - your phone line is a single twisted pair that runs all the way back to the central office, and it's yours and yours alone. From there, you've got an incumbent carrier that laid the lines or at least has legal possession of them (the ILEC), and you've got competitive carriers (the CLEC) who are given the right to lease lines from the ILEC at fair rates, and either one can take your twisted pair and give you service over it.

Another factor preventing shared cable markets is that many municipalities offer a pseudo-"protected monopoly" status to cable carriers in exchange for the carrier agreeing to provide service to the entire area. The local government gets their constituents internet access, and the cable company gets so many years of almost guaranteed .

I knew that Cable was a shared bandwidth medium, I guess I just forgot to connect the dots on that point. Also now that you mentioned the whole thing about municipalities, I remember how Verizon and Cablevision got into lawsuits and slapfights in my area over local exclusivity deals in certain towns and such when Verizon was heavily rolling out their fiber. The result is that I can get FIOS Internet and phone, but not TV.

Man, this poo poo fuckin' sucks. This merger is going to gently caress so many people over (even more than they're being hosed over now).

# ? Feb 15, 2014 02:06

psydude: Apr 1, 2008

The biggest contributing factor is that ISPs aren't regulated as utilities, so they aren't obligated to allow competitors to use their lines. Electric companies are required by law to do this, which is why you can usually choose from 4-5 different ones in your area. This was actually the reason why the recent ruling on Net Neutrality wound up the way it did: the FCC never bothered classifying them as such.

# ? Feb 15, 2014 02:23

Cenodoxus: Mar 29, 2012; while [[ true ]] ; do
��pour()
done

chocolateTHUNDER posted:

Man, this poo poo fuckin' sucks. This merger is going to gently caress so many people over (even more than they're being hosed over now).

I refuse to let myself get hosed over. I live in Kansas City, I'm currently a Time Warner subscriber, and I happen to be in the market for a house. Now I'm restricting my search to places where Google Fiber has announced service, because gently caress Comcast.

Google Fiber 4lyfe. (Once they get around to me in 2016 - oops, I mean 2116.) :suicide:

psydude posted:

Electric companies are required by law to do this, which is why you can usually choose from 4-5 different ones in your area.

I've never heard of this before... where is this a thing? 4-5 electric companies in one area sounds like a clusterfuck. How does it work?

Cenodoxus fucked around with this message at 02:55 on Feb 15, 2014

# ? Feb 15, 2014 02:52

FruitNYogurtParfait: Mar 29, 2006; Sion lied. Deadtear died for our sins. #VengeanceForDeadtear
#PunGateNeverForget
#ModLivesMatter

Cenodoxus posted:

I refuse to let myself get hosed over. I live in Kansas City, I'm currently a Time Warner subscriber, and I happen to be in the market for a house. Now I'm restricting my search to places where Google Fiber has announced service, because gently caress Comcast.

Google Fiber 4lyfe. (Once they get around to me in 2016 - oops, I mean 2116.)

I've never heard of this before... where is this a thing? 4-5 electric companies in one area sounds like a clusterfuck. How does it work?

You pick a company. Ok done.

# ? Feb 15, 2014 03:20

Cenodoxus: Mar 29, 2012; while [[ true ]] ; do
��pour()
done

deadtear posted:

You pick a company. Ok done.

From the consumer's point of view, sure, but how do four electric companies on the same block play nicely with each other? Four sets of lines on four poles?

It's tough for me to imagine because everywhere I've ever lived, you have one choice, and it's either municipal public power ($0.07/kWh :c00lbert:

) or a single private company.

# ? Feb 15, 2014 03:44

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

Cenodoxus posted:

From the consumer's point of view, sure, but how do four electric companies on the same block play nicely with each other? Four sets of lines on four poles?

It's tough for me to imagine because everywhere I've ever lived, you have one choice, and it's either municipal public power ($0.07/kWh ) or a single private company.

Everyone feeds into the same grid.

# ? Feb 15, 2014 04:01

PUBLIC TOILET: Jun 13, 2009

If this gets federal approval then I'll have no choice but to rent/own housing in FiOS-supported areas where I reside. It's either Time Warner or Verizon around these parts and the coverage area for FiOS is limited. Basically it's either steaming poo poo, or just a regular pile of poo poo (with a contract).

# ? Feb 15, 2014 06:04

brothertim: Mar 6, 2013

My specialty is bird law, so I'm not entirely certain what the government would think about two major companies merging, when the result would cause monopolies (whether anticipated or not) in a large amount of cities/towns. I was pretty sure that's illegal...

# ? Feb 15, 2014 06:31

Don Lapre: Mar 28, 2001; If you're having problems you're either holding the phone wrong or you have tiny girl hands.

brothertim posted:

My specialty is bird law, so I'm not entirely certain what the government would think about two major companies merging, when the result would cause monopolies (whether anticipated or not) in a large amount of cities/towns. I was pretty sure that's illegal...

A monopoly isn't illegal.

There would be no more a monopoly in cities and towns as there is now.

# ? Feb 15, 2014 06:32

brothertim: Mar 6, 2013

Don Lapre posted:

A monopoly isn't illegal.

What. the. gently caress.

So, creating the monopoly is legal, but using your market domination to then charge people $200/month for internet access would be illegal?

edit: I gotta know where the line gets drawn by the gov.

# ? Feb 15, 2014 06:41

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# ? Apr 28, 2024 20:27

forbidden dialectics: Jul 26, 2005

I pay for Time Warner's 110 Mbps service, and it's been great. Well, actually, it's been great ever since one of their employees gave me the VP for Southern CA's personal cell phone number and I called him at dinner and asked him why I was only getting 10Mbps. I hope this arrangement doesn't change; Richard, I hope Comcast lets you keep your job, my throughput depends on it.

# ? Feb 15, 2014 07:33

The Something Awful Forums > Discussion > Serious Hardware/Software Crap > Comcast, Time Warner Agree to Merge

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