Comcast Acquisition Of Time Warner A Strategic Move Against Cord Cutters
As we’ve all had some time to digest the potential reality of a Comcast-Time Warner Cable merger, there’s some thought out there that the two giants could be making a move specifically designed to target cord-cutters, those brave souls who’ve given the one-finger salute to traditional pay-TV providers and their steep fees and incommensurate product.
Farhad Manjdo of the New York Times writes that the new, bigger Comcast can recoup any lost cable customers by ensuring that it provides them their Internet service. So one way or another, they get to decide how much customers in its markets pay for cable and/or Internet access.
From a business perspective, that obviously makes sense. Comcast can just mark up any Internet-only plans and offer a TV-and-Internet bundle that doesn’t cost much more. If you’re only paying an extra $10, $20, or $30 a month for a pile of cable channels, it sounds like a pretty good deal.
To be clear, the consumer doesn’t win here; cord-cutters would be gouged by higher ISP prices, and those who bundle would likely be paying roughly the same amount. It’s just a matter of re-jiggering the pricing structure.
Worse, Comcast could also attack streaming services like Netflix, Hulu, Amazon, and others by throttling their speeds and forcing them to raise their fees to get that speed back--which is precisely the sort of thing that net neutrality is designed to prevent. (If you recall, net neutrality rules suffered a setback just last month, although the FCC is fighting back.)
Comcast would be able to easily get away with this because there’s so little competition among ISPs and cable providers. Combining the two largest cable companies in the U.S. will only make a bad situation that much worse for consumers. Here’s hoping regulatory agencies will agree that this merger is a terrible idea for consumers and nix the deal.
Farhad Manjdo of the New York Times writes that the new, bigger Comcast can recoup any lost cable customers by ensuring that it provides them their Internet service. So one way or another, they get to decide how much customers in its markets pay for cable and/or Internet access.
From a business perspective, that obviously makes sense. Comcast can just mark up any Internet-only plans and offer a TV-and-Internet bundle that doesn’t cost much more. If you’re only paying an extra $10, $20, or $30 a month for a pile of cable channels, it sounds like a pretty good deal.
To be clear, the consumer doesn’t win here; cord-cutters would be gouged by higher ISP prices, and those who bundle would likely be paying roughly the same amount. It’s just a matter of re-jiggering the pricing structure.
Worse, Comcast could also attack streaming services like Netflix, Hulu, Amazon, and others by throttling their speeds and forcing them to raise their fees to get that speed back--which is precisely the sort of thing that net neutrality is designed to prevent. (If you recall, net neutrality rules suffered a setback just last month, although the FCC is fighting back.)
Comcast would be able to easily get away with this because there’s so little competition among ISPs and cable providers. Combining the two largest cable companies in the U.S. will only make a bad situation that much worse for consumers. Here’s hoping regulatory agencies will agree that this merger is a terrible idea for consumers and nix the deal.
