Could a Comcast Colossus Completely Control the Internet?

 

Whether or not you have cable TV, whether or not you use Comcast for phone service, you should be concerned about Comcast’s plan to merge with Time Warner. Ultimately, everyone who uses the Internet could be impacted. But not in the consumer-friendly way Comcast claims.

TURN is urging the California Public Utilities Commission to reject the Comcast/Time-Warner mega merger in order to protect phone customers whose service from the two companies is still regulated by the CPUC. Time-Warner recently received approval to serve low-income customers, a commitment TURN wants to see the company held to.

In a vaguely worded application for approval the two cable behemoths claim the mega merger would “generate substantial public interest benefits, with no countervailing harms.” But it is hard to see how the public will benefit. TURN has heard similar claims in defense of mega-mergers in the past, and ultimately they have always rung hollow.

TURN ally Public Citizen has pointed out that Comcast’s track record on following through on consumer commitments does not bode well. Public Knowledge VP Mike Weinberg recently told US News and World Report that Comcast “has not done a very good job” of upholding the commitments it made to the FCC in order to get its 2011 mega-merger with NBC approved. At the same time, Comcast is taking advantage of its market share to push its own content ahead of competitors.

Comcast is already big enough to put the screws to Netflix, itself a market giant. Netflix accounts for close to a third of all traffic during “primetime” Internet hours – 9pm to 12am. But Comcast was able to slow the speeds at which Netflix content was delivered to customers.

Netflix was eventually forced to pay Comcast higher fees for access. So why should we expect different from a Comcast colossus? If the merger goes through, Comcast will provide Internet service to about 40% of the U.S. If it has the power to pick and chose which content gets fast access now, imagine what an even bigger Comcast could do- and probably would.

Comcast claims it won’t hold dominant market share, at least as far as phone service goes. Even if that were true statewide it would certainly not be true in all communities. And for cable customers, whose hatred of both companies comes across loud and clear in every survey of customer satisfaction, the situation is even worse. AT&T, another wildly unpopular company, has announced its intention to swallow DIRECT TV whole.

Big companies seeking growth on steroids always make the same arguments. They’ll have the power to innovate! And they’re not really monopolies, even if it looks that way!

But if we take a closer look, there’s usually a bottom line calculation behind their mega-growth. In this case, the stakes are especially high: if Comcast gets its way, it will be a huge step closer to, quite literally, world domination of the Internet. Comcast has already acknowledged that the colossus is an effort to cut off video and broadband competition from mere giants like Google and Yahoo.  The more bandwidth Comcast controls, the more bandwidth it can exert control over.

At one time, our country had a commitment to preventing unregulated monopoly power in the telecommunications marketplace. We broke up the AT&T monopoly in 1984, hoping that after the company was split into smaller ones that would be more vulnerable to competition and more accountable to customers. Instead, AT&T has become the Humpty-Dumpty of the Internet age, putting itself back together bigger, more ubiquitous and far, far more profitable than ever before, expanding into cable, Internet, mobile phones and anything else it can get its hands on. Comcast’s power- and reach- is largely unfettered as well. As the Internet becomes an absolute necessity of modern life, these companies are positioning themselves to be its gatekeepers.

With phone, cable and broadband access increasingly tied to just a few corporations with almost no accountability, we need to modernize our rules to protect these essential services. If we don’t, the unregulated, insatiable companies that already control our cable and phone service will end up hijacking the Internet as well.

TURN;s brief on Comcast-Time Warner Merger