11 ms·

Comcast Plans to Drop Time Warner Cable Deal

272 points by coloneltcb 12y ago

walterbell 12y ago
From a discussion of the open issues, http://www.wetmachine.com/tales-of-the-sausage-factory/comcasttwccharter-looking-good-but-too-early-to-pop-the-champagne/ http://www.wetmachine.com/tales-of-the-sausage-factory/comca... "..as someone who has played regulatory poker with Comcast for 15 years now, I can say from personal experience that no one counts Comcast out until the game is well and truly over. Even if the rumors are true (and I have no way of knowing), these would only be staff recommendations. Comcast still has plenty of opportunities to plead, cajole and bully DoJ and FCC into submission. Which is why it’s important to remember my advice from last February with regard to Title II reclassification: DON’T BE THE SEA HAWKS! We need to continue to keep the pressure on to get this over the goal line.. • The Antitrust Case Is Much Stronger Than People Initially Assumed. • The Three Legs of the Antitrust Stool: Access to Programming, Access To Set-Top Boxes and Access to Broadband. • Recent Win By The DoJ Supports Key Elements of the Potential Theory Against Comcast/TWC. • Nobody Else Really Likes This Merger — And Most People Hate It. • Conclusion — Still Too Early To Call A Win, But Path To Victory Clear."
- Artistry121 12y ago
  Great Seahawks reference. Haha It is important to stay vigilant.
sandworm 12y ago
Give them a couple years. After a few more "government is bad" TV spots, and under a republican president, they will try again. Whether they merge today or then doesn't really matter. They are effectively merged already. They stay away from each other, treating customers like each other's property, and offer comparable services at comparable prices. They aren't in any real competition with each other. I'm not saying that they should merge. Rather, I'm saying that them not merging isn't a quick fix of the underlying issue. Americans need actual choice of providers within a given technology.
- nashashmi 12y ago
  True, but it was never the end users who were going to be affected by this deal. It was the suppliers and vendors and other service providers who were going to be hurt because there were going to be fewer and fewer clients that they could work with.
  - alexqgb 12y ago
    Bingo. There were precisely zero content providers (outside NBC) who were looking forward to dealing with a monopsony that also owned a direct competitor.
- lighthawk 12y ago
  > under a republican president Democrat or Republican doesn't matter. Lobbying and who is offered and receives campaign contributions, etc. matter. It's about manipulation, money and power/getting re-elected, plain and simple. Notice the Reps and Dems on this list of campaign contributions from Comcast: https://www.opensecrets.org/orgs/summary.php?id=D000000461 https://www.opensecrets.org/orgs/summary.php?id=D000000461 Top Recipients from Comcast: National Republican Congressional Cmte, John Boehner (R-OH), National Republican Senatorial Cmte, Democratic Senatorial Campaign Cmte, DNC Services Corp, Democratic Congressional Campaign Cmte, Ed Markey (D-MA), Democratic Municipal Officials, Cory Booker (D-NJ), Fred Upton (R-MI) Comcast spent $16,970,000 on lobbying in 2014. They likely lobbied both Reps and Dems. Those noted who own Comcast shares: Barber, Ron (D-AZ) Boehner, John (R-OH) Cohen, Steve (D-TN) Collins, Susan M (R-ME) Cooper, Jim (D-TN) Dingell, John D (D-MI) Frankel, Lois J (D-FL) Frelinghuysen, Rodney (R-NJ) Hagan, Kay R (D-NC) Hanna, Richard (R-NY) Heck, Dennis (D-WA) Holding, George (R-NC) Isakson, Johnny (R-GA) Kelly, Mike (R-PA) Marchant, Kenny (R-TX) McCaul, Michael (R-TX) McDermott, Jim (D-WA) Pelosi, Nancy (D-CA)
  - deleted 12y ago
    [deleted]
  - rayiner 12y ago
    Note that Comcast, as a corporation, is prohibited from donating money to political campaigns: http://www.usatoday.com/story/news/politics/2014/04/07/supreme-court-political-donation-corporations/7417035 http://www.usatoday.com/story/news/politics/2014/04/07/supre.... OpenSecrets has been sweeping that disclaimer more and more under the rug, to the point where now I'd accuse them of lying.
istvan__ 12y ago
Thanks guys! - The customers
higherpurpose 12y ago
It's a shame TWC didn't ask for $4 billion merger rejection fee, like T-mobile did with AT&T. Maybe it could've used that money to compete in Comcast's markets now. If Comcast's plan was to "expand", then it might be forced to get into TWC's markets soon anyway, which means TWC will also respond by going into Comcast's markets. At least that's how I'm hoping it will play out.
- blinkingled 12y ago
  I highly doubt TWC would've invested the $4B to do something good for the consumers! Comcast and TWC had plenty of opportunity to attack each other's territories but for whatever reason they chose to have mutually beneficial agreements on territory control. I don't see that changing. The only thing that's good is the hope that with the deal called off, it won't get any worse than it already is.
  - beambot 12y ago
    TWC may not have much recourse. With new entrants (eg. Google Fiber) entering the fray, the existing oligopoly must respond.
    - Phlarp 12y ago
      Maybe new entrants will pressure the entrenched players in markets where new entrants exist. Everywhere else will stay the same, it's not like we hear many people complaining about internet service in places where Google Fiber is deployed.
    - blinkingled 12y ago
      Yep, Fiber is slated to come in my area and confirmed rumor is that TWC is already increasing my speed 6x for the same price. Sad part is Google Fiber or new entrants aren't getting everywhere fast enough.
- mathattack 12y ago
  There's a lot of backroom dealing on things like this. Some depends on how many suitors, and who wants the deal more. Other times it's more nefarious, and involves things like golden parachutes or planned roles in the new company.
FrankenPC 12y ago
Proof that some portion of the Federal government still works properly. This was a terrible idea from day one. It may be populist low hanging fruit to kill the merger, but populism certainly hasn't stopped other terrible ideas from coming to fruition (Citizens United)
- eli 12y ago
  If the reports are to be believed, it was the staff at the FCC and DOJ who were recommending to block the merger. These are usually career employees who serve across administrations; it's more likely they were just doing their job, not cowing to public demands.
  - digikata 12y ago
    I do think that public demands help to prevent the FCC and DOJ upper management from sidelining staff recommendations.
- aaronbrethorst 12y ago
  populism certainly hasn't stopped other terrible ideas from coming to fruition (Citizens United) What does a SCOTUS justice care about populism? They're appointed for life. They care about their legacy, or the legitimacy of the institution[1], but it's not like Americans are going to show up at the Supreme Court with pitchforks and torches in hand. If you want to make sure another Citizens United decision doesn't happen any time soon, it would be worthwhile to think carefully about your choice for President next year. edit: also, as others have noted, this deal wasn't under the purview of the Supreme Court, but instead the FCC, FTC, and DOJ. [1] http://www.slate.com/articles/news_and_politics/jurisprudence/2012/06/john_roberts_broke_with_conservatives_to_preserve_the_supreme_court_s_legitimacy.html http://www.slate.com/articles/news_and_politics/jurisprudenc...
  - Retra 12y ago
    Who have you chosen for president next year? Or are you also waiting to be told who the actual candidates are?
mathattack 12y ago
It says something about a deal when the stock price of both companies rises after an announcement like this.
- nickysielicki 12y ago
  I think it says something about a market.
- jessaustin 12y ago
  Mergers are often more about executive nest-feathering than about "synergy" or whatever, aren't they?
  - emodendroket 12y ago
    They also tend to drive up stock prices.
    - mathattack 12y ago
      Usually the acquired gains most of the boost. There's a net gain if there is an increase in market power. It's rare to get positive synergies, unless you consider layoffs a synergy.
      - emodendroket 12y ago
        Don't most shareholders? Labor is an expense.
        mathattack 12y ago
        Poor wording on my part - I wasn't putting in a value judgment. By positive synergy I mean on the revenue side. "They have A sales people selling B per year on product set C. We have D sales people selling E per year on product set F. If we allow their salespeople to sell F and ours to sell C, our revenues will grow from A * B and D * E to A * (B + E) and D * (B + E)." That's a long way of saying revenue promises rarely materialize, but cost ones usually do.
yeukhon 12y ago
I live in NYC, so in general I am lucky to have cable Internet service. I lived in SF for a brief period of time, and Comcast was expensive and slow. I am quite glad this deal is off. I have been TWC Internet service user for many years and it used to be so-so compared to FiOS. When I finally had the chance to switch to FiOS I was very excited, but after comparing customer service, speed, and price, I just couldn't move away. I couldn't move to RCN because so many instability (probably due to over provisioned pools). TWC's new plan is cheaper and pretty reliable where I live. I did invest some serious cash on getting my own modem SB6141 and a very good wireless router, which definitely has boosted bandwidth and performance. TWC and Comcast's stock modem sucks (and now you either buy or rent). I was surprised to see how many people were willing to rent because of simplicity; go to Amazon, spend $100-$130 on the modem, ship it, and install the modem. As a customer, I just hope we can have more reliable options. Technically, $40 for up to 100 Mbps is still a little high (but 3-5 years ago it would be like $70, $80 a month). The day when we are offered 100Mpbs at "DSL" plan price range, I will be really happy. Actually, I'd be even happier if we can build out the cellular data technology... "4Gb for $40? Yes, first 1G at 4G speed, the rest, like 56kpbs." I want to see the day when cellular data can be just as quick as my home network. I am not very concerned with other monopolies (search, TV, , music etc), but telecom monopoly is a big concern to me.
- shmerl 12y ago
  NYC still doesn't have gigabit for $70.
  - rayiner 12y ago
    Think about what a marketing coup it would be for Google to wire up San Francisco or New York City with Fiber. And think of how awful the red-tape in those cities must be for even Google to steer clear.
    - shmerl 12y ago
      I think they should do it at some point. It's just too major of a potential to ignore.
deleted 12y ago
[deleted]
ab 12y ago
It's interesting how Comcast's track record in complying with regulatory requirements from past deals may be a major factor here. I wonder if they would have been able to muscle this through had they been just a little bit less awful in the past.

272 points by coloneltcb 12y ago

From a discussion of the open issues, http://www.wetmachine.com/tales-of-the-sausage-factory/comcasttwccharter-looking-good-but-too-early-to-pop-the-champagne/ http://www.wetmachine.com/tales-of-the-sausage-factory/comca... "..as someone who has played regulatory poker with Comcast for 15 years now, I can say from personal experience that no one counts Comcast out until the game is well and truly over. Even if the rumors are true (and I have no way of knowing), these would only be staff recommendations. Comcast still has plenty of opportunities to plead, cajole and bully DoJ and FCC into submission. Which is why it’s important to remember my advice from last February with regard to Title II reclassification: DON’T BE THE SEA HAWKS! We need to continue to keep the pressure on to get this over the goal line.. • The Antitrust Case Is Much Stronger Than People Initially Assumed. • The Three Legs of the Antitrust Stool: Access to Programming, Access To Set-Top Boxes and Access to Broadband. • Recent Win By The DoJ Supports Key Elements of the Potential Theory Against Comcast/TWC. • Nobody Else Really Likes This Merger — And Most People Hate It. • Conclusion — Still Too Early To Call A Win, But Path To Victory Clear."

Artistry121 12y ago
Great Seahawks reference. Haha It is important to stay vigilant.

sandworm 12y ago

Give them a couple years. After a few more "government is bad" TV spots, and under a republican president, they will try again. Whether they merge today or then doesn't really matter. They are effectively merged already. They stay away from each other, treating customers like each other's property, and offer comparable services at comparable prices. They aren't in any real competition with each other. I'm not saying that they should merge. Rather, I'm saying that them not merging isn't a quick fix of the underlying issue. Americans need actual choice of providers within a given technology.

nashashmi 12y ago
True, but it was never the end users who were going to be affected by this deal. It was the suppliers and vendors and other service providers who were going to be hurt because there were going to be fewer and fewer clients that they could work with.
- alexqgb 12y ago
  Bingo. There were precisely zero content providers (outside NBC) who were looking forward to dealing with a monopsony that also owned a direct competitor.
lighthawk 12y ago
> under a republican president Democrat or Republican doesn't matter. Lobbying and who is offered and receives campaign contributions, etc. matter. It's about manipulation, money and power/getting re-elected, plain and simple. Notice the Reps and Dems on this list of campaign contributions from Comcast: https://www.opensecrets.org/orgs/summary.php?id=D000000461 https://www.opensecrets.org/orgs/summary.php?id=D000000461 Top Recipients from Comcast: National Republican Congressional Cmte, John Boehner (R-OH), National Republican Senatorial Cmte, Democratic Senatorial Campaign Cmte, DNC Services Corp, Democratic Congressional Campaign Cmte, Ed Markey (D-MA), Democratic Municipal Officials, Cory Booker (D-NJ), Fred Upton (R-MI) Comcast spent $16,970,000 on lobbying in 2014. They likely lobbied both Reps and Dems. Those noted who own Comcast shares: Barber, Ron (D-AZ) Boehner, John (R-OH) Cohen, Steve (D-TN) Collins, Susan M (R-ME) Cooper, Jim (D-TN) Dingell, John D (D-MI) Frankel, Lois J (D-FL) Frelinghuysen, Rodney (R-NJ) Hagan, Kay R (D-NC) Hanna, Richard (R-NY) Heck, Dennis (D-WA) Holding, George (R-NC) Isakson, Johnny (R-GA) Kelly, Mike (R-PA) Marchant, Kenny (R-TX) McCaul, Michael (R-TX) McDermott, Jim (D-WA) Pelosi, Nancy (D-CA)
- deleted 12y ago
  [deleted]
- rayiner 12y ago
  Note that Comcast, as a corporation, is prohibited from donating money to political campaigns: http://www.usatoday.com/story/news/politics/2014/04/07/supreme-court-political-donation-corporations/7417035 http://www.usatoday.com/story/news/politics/2014/04/07/supre.... OpenSecrets has been sweeping that disclaimer more and more under the rug, to the point where now I'd accuse them of lying.

istvan__ 12y ago

Thanks guys! - The customers

higherpurpose 12y ago

It's a shame TWC didn't ask for $4 billion merger rejection fee, like T-mobile did with AT&T. Maybe it could've used that money to compete in Comcast's markets now. If Comcast's plan was to "expand", then it might be forced to get into TWC's markets soon anyway, which means TWC will also respond by going into Comcast's markets. At least that's how I'm hoping it will play out.

blinkingled 12y ago
I highly doubt TWC would've invested the $4B to do something good for the consumers! Comcast and TWC had plenty of opportunity to attack each other's territories but for whatever reason they chose to have mutually beneficial agreements on territory control. I don't see that changing. The only thing that's good is the hope that with the deal called off, it won't get any worse than it already is.
- beambot 12y ago
  TWC may not have much recourse. With new entrants (eg. Google Fiber) entering the fray, the existing oligopoly must respond.
  - Phlarp 12y ago
    Maybe new entrants will pressure the entrenched players in markets where new entrants exist. Everywhere else will stay the same, it's not like we hear many people complaining about internet service in places where Google Fiber is deployed.
  - blinkingled 12y ago
    Yep, Fiber is slated to come in my area and confirmed rumor is that TWC is already increasing my speed 6x for the same price. Sad part is Google Fiber or new entrants aren't getting everywhere fast enough.
mathattack 12y ago
There's a lot of backroom dealing on things like this. Some depends on how many suitors, and who wants the deal more. Other times it's more nefarious, and involves things like golden parachutes or planned roles in the new company.

FrankenPC 12y ago

Proof that some portion of the Federal government still works properly. This was a terrible idea from day one. It may be populist low hanging fruit to kill the merger, but populism certainly hasn't stopped other terrible ideas from coming to fruition (Citizens United)

eli 12y ago
If the reports are to be believed, it was the staff at the FCC and DOJ who were recommending to block the merger. These are usually career employees who serve across administrations; it's more likely they were just doing their job, not cowing to public demands.
- digikata 12y ago
  I do think that public demands help to prevent the FCC and DOJ upper management from sidelining staff recommendations.
aaronbrethorst 12y ago
populism certainly hasn't stopped other terrible ideas from coming to fruition (Citizens United) What does a SCOTUS justice care about populism? They're appointed for life. They care about their legacy, or the legitimacy of the institution[1], but it's not like Americans are going to show up at the Supreme Court with pitchforks and torches in hand. If you want to make sure another Citizens United decision doesn't happen any time soon, it would be worthwhile to think carefully about your choice for President next year. edit: also, as others have noted, this deal wasn't under the purview of the Supreme Court, but instead the FCC, FTC, and DOJ. [1] http://www.slate.com/articles/news_and_politics/jurisprudence/2012/06/john_roberts_broke_with_conservatives_to_preserve_the_supreme_court_s_legitimacy.html http://www.slate.com/articles/news_and_politics/jurisprudenc...
- Retra 12y ago
  Who have you chosen for president next year? Or are you also waiting to be told who the actual candidates are?

mathattack 12y ago

It says something about a deal when the stock price of both companies rises after an announcement like this.

nickysielicki 12y ago
I think it says something about a market.
jessaustin 12y ago
Mergers are often more about executive nest-feathering than about "synergy" or whatever, aren't they?
- emodendroket 12y ago
  They also tend to drive up stock prices.
  - mathattack 12y ago
    Usually the acquired gains most of the boost. There's a net gain if there is an increase in market power. It's rare to get positive synergies, unless you consider layoffs a synergy.
    - emodendroket 12y ago
      Don't most shareholders? Labor is an expense.
      - mathattack 12y ago
        Poor wording on my part - I wasn't putting in a value judgment. By positive synergy I mean on the revenue side. "They have A sales people selling B per year on product set C. We have D sales people selling E per year on product set F. If we allow their salespeople to sell F and ours to sell C, our revenues will grow from A * B and D * E to A * (B + E) and D * (B + E)." That's a long way of saying revenue promises rarely materialize, but cost ones usually do.

yeukhon 12y ago

I live in NYC, so in general I am lucky to have cable Internet service. I lived in SF for a brief period of time, and Comcast was expensive and slow. I am quite glad this deal is off. I have been TWC Internet service user for many years and it used to be so-so compared to FiOS. When I finally had the chance to switch to FiOS I was very excited, but after comparing customer service, speed, and price, I just couldn't move away. I couldn't move to RCN because so many instability (probably due to over provisioned pools). TWC's new plan is cheaper and pretty reliable where I live. I did invest some serious cash on getting my own modem SB6141 and a very good wireless router, which definitely has boosted bandwidth and performance. TWC and Comcast's stock modem sucks (and now you either buy or rent). I was surprised to see how many people were willing to rent because of simplicity; go to Amazon, spend $100-$130 on the modem, ship it, and install the modem. As a customer, I just hope we can have more reliable options. Technically, $40 for up to 100 Mbps is still a little high (but 3-5 years ago it would be like $70, $80 a month). The day when we are offered 100Mpbs at "DSL" plan price range, I will be really happy. Actually, I'd be even happier if we can build out the cellular data technology... "4Gb for $40? Yes, first 1G at 4G speed, the rest, like 56kpbs." I want to see the day when cellular data can be just as quick as my home network. I am not very concerned with other monopolies (search, TV, , music etc), but telecom monopoly is a big concern to me.

shmerl 12y ago
NYC still doesn't have gigabit for $70.
- rayiner 12y ago
  Think about what a marketing coup it would be for Google to wire up San Francisco or New York City with Fiber. And think of how awful the red-tape in those cities must be for even Google to steer clear.
  - shmerl 12y ago
    I think they should do it at some point. It's just too major of a potential to ignore.

deleted 12y ago

[deleted]

ab 12y ago

It's interesting how Comcast's track record in complying with regulatory requirements from past deals may be a major factor here. I wonder if they would have been able to muscle this through had they been just a little bit less awful in the past.