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Kramer: Comcast merger with Time Warner Cable creates negative effects for consumers

The sprawling white tent on the Quad was a welcoming spectacle for incoming freshmen at Syracuse University. Sitting quietly in the corner of that tent amidst the crowd was a small table for Time Warner Cable, which was offering its campus television deals. We looked at the smiling salesmen, and then some of us to our parents, who gave a look that said “We’re paying enough already.”

Within a few years, Time Warner Cable may no longer be offering plans on their own terms. In February, Comcast Corporation proposed a $45 billion buyout of the cable company, a move that has attracted the full attention of the FCC and the United States Department of Justice Antitrust Division, which has launched investigations into the legality of the deal. Comcast representatives appeared in the Senate last week for questioning.

The worries are well warranted. According to an April 9 report by The Verge, Comcast maintains 42.4 million subscribers between broadband and cable. The next closest competitor is Time Warner Cable with 22 million subscribers. Politicians from both parties are highly skeptical of how such a merger could possibly benefit consumers.

The worry is that if Comcast furthers its grip across the U.S. under the defense that it isn’t technically undermining competition, there will be less incentive to improve or offer low cable prices to subscribers.

Currently, Time Warner Cable presides over Syracuse, as part of the city’s cable franchise — where one cable company services the entire population. If Comcast were to take over Time Warner Cable, it wouldn’t necessarily mean the service would improve. In fact, Comcast isn’t a popular provider because of its service. In April, watchdog group The Consumerist named it the “worst company in America,” along with many other criticisms of its customer service.



Comcast is popular across the country for the same reason Time Warner Cable is popular in Syracuse: There is no direct competition. That explains why even if you were unhappy with Time Warner Cable, you couldn’t switch to anything else unless you moved. If the merger is approved, it would be the same situation, but you’d have to move a lot further.

Comcast controls the densest populations of New Jersey, Pennsylvania, Florida, California and Indiana among many other places. Time Warner Cable presides over Syracuse, as it does much of New York, Ohio, North Carolina, Maine and Kentucky.

But in the same way that Facebook wants to be more than a social website and Google wants to be more than a search engine, Comcast wants to be more than just a service provider.

David Cohen, executive VP of the company and the main participant in current Senate hearings said in an April 8 Wall Street Journal article regarding the deal that Comcast needs “to up our game,” and that the expansion would provide chances to improve service and offer better experiences.

But if being the number one cable provider in the nation wasn’t already enough incentive to do all that, his promises don’t hold much weight. Perhaps Cohen should have been listening to the constant complaints about his company that have been occurring since its founding.

From the consumer’s viewpoint, there doesn’t look to be much of a purpose for the merger other than for Comcast to further control the field of cable and broadband service. Nobody can say if cable bills will go up, but they certainly won’t go down — even David Cohen said as much.

While the deal may pass through the FCC’s investigation with some restrictions, there is no foreseeable benefit to consumers that comes along with a Comcast that is bigger, rather than better.

Phil Kramer is a freshman advertising and marketing management major. His column appears weekly. You can reach him at [email protected] and on Twitter at @PhilipWKramer





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