Lawmakers questioned Comcast on their proposed Time Warner grab today, asking how the company felt it would benefit consumers. The $45 billion deal, expected to affect some 20 million users, has lawmakers concerned consumers won’t see much benefit. They’re also fearing we could see already high cable bills inflate.
Asking how Comcast would stem the cost of cable for consumers, Rep. Suzan DelBene (D., Wash) said “You’ve said that you don’t expect this transition to have an impact on prices. What can be done to help lower prices?” David Cohen, Executive Vice President of Comcast, couldn’t give an answer, instead offering the deal “has the potential to slow the increase in prices.”
Cohen went on to say “a significantly improved customer experience” would be an important plus to this deal for Time Warner customers. Comcast offers “better WiFi, more programming choices, faster Internet”, and their X-1 operating system, which Cohen laid out in a blog post about today’s meetings. He also outlined why this deal was important:
In a nutshell, this transaction will give us the scale to invest more in innovation and infrastructure, so we can compete more effectively with our mostly larger national and global competitors, including the Bells, DirecTV, DISH, Apple, and Google, to name a few. And when we invest, so do our competitors. AT&T, for instance, has said this transaction "puts a heightened sense of urgency" on competitors to invest more in their networks and improve service. The ultimate beneficiary of this enhanced competition and greater investment is the American consumer.
The debate is ongoing. The FCC rules on capped ownership have been leaned upon by many who have a distaste for the deal, while Comcast believes the merger is in everyone’s best interest. As it matriculates through the review process, we should find out just what Comcast has in mind for this merger. So far, we’re not getting much detail from Comcast on why this is important, other than to thwart a cable-cutting uprising, and best practices for a competitive market. AT&T’s comments on the matter may have been taken out of context; Comcast expands to dominate, the rest invest in upgrades to survive.