GrogHeads Forum

Comcast announced it's intent to buy Time Warner Cable, I really don't think this is good for a already under competitive industry.

Well, there are cases to be made in either direction. 

They don't operate in the same markets, so there's nowhere that a customer's choice is going to be reduced.
That said, it's pretty tough to claim that one of the most-hated companies in America (for their poor customer service) is going to get less hated by getting bigger.

To me, the toughest pill to swallow is the recent court rulings on net neutrality.  Part of the justification for striking down net neutrality was that there were enough service options within the marketplace that customers could leave one ISP for another if their content was being throttled.  Well, this significantly cuts into that market choice.  And Comcast couldn't wait to start throttling back on Netflix traffic once the ruling came through, either, as this guy has noted: http://mattvukas.com/2014/02/10/comcast-definitely-throttling-netflix-infuriating/

In a Monopolistic society in the end there can only be one.

I received the following email from Time Warner Cable this morning:

Quote from: Time Warner CableMarch 2014


Dear Valued Customer:

Recently, Time Warner Cable announced plans to merge with Comcast, forming an industry-leading technology and media company dedicated to delivering great customer experiences.

Above all, this merger will benefit you, our customers. Our two companies have been behind many of the innovative services that you enjoy every day—digital cable TV, high-speed Internet, DVRs, Video On Demand and WiFi in the home and on-the-go—to name just a few. The combined company will innovate faster and deploy even better products and features, including a superior video guide, faster Broadband Internet speeds and even more WiFi access points so you can access the Internet wherever you go.

We expect the merger to close around the end of 2014. In the meantime, all of us at Time Warner Cable remain committed to providing you with great TV, ultra-fast Internet, rock solid phone service and innovative home security and monitoring. And we will continue to make significant investments to improve reliability and to enhance our customer service.

We are very excited about the promise of this combination for you, our customers.
We'll keep you posted as things evolve in the coming months.

As always, thank you for choosing Time Warner Cable.

Sincerely,
Signature
Robert D. Marcus
Chairman and Chief Executive Officer

This comes after the notification in my last bill of the increase in monthly prices effective on my next billing statement. I see there will be a $3.41 increase for "Standard Internet" (previously known as Roadrunner) and various other cost increases ranging from about $1 to $3. If I don't want a big surprise when I receive my bill next month I will have to have to contact them to find out how much certain charges are going to be since they aren't specifically mentioned. For example, one that costs me $20.95 a month is not mentioned except as being included in another plan that will increase from $64.95 to $66.99 a month (I was paying $20.95).

"Dear Customer, when your next bill arrives please bend over, close your eyes, and think of your Favorite Media Content..."

Yeah, I wasn't exactly thrilled at the news.  In fact, I think "dismay" sums up my reaction pretty well. 

You would think after playing the game monopoly that every American would have a decent understanding of what the concept really means.

I guess we will just have to relive and relearn the same thing over again as we did in this country in the late 1800's and early 20th century.

As for now. Hope and change is going to be a very expensive and painful learning experience and I doubt any of our newly or future elected oligarchs are going to press for any legislation to effectively combat the new economic reality.

Let's get one thing out of the way first: I think this merger is a bad idea

OK, now for the rest of it
-- total percent of US TV households covered by the merged companies: 32% (and they're divesting some to get down to 30%)
-- number of zip codes in which the 2 companies are both available today: 0 (so no customers are having their choices taken away)

They're not a monopoly and they're not overlapping anywhere that they'd be competing with each other.  Cable companies have been jacking rates forever and will continue to do so because there's so little real competition for wire-line TV content.  They would be raising prices whenever they could without the merger, so let's not blame the merger for the cost increases

Now, for why this is a bad thing: those 30% of TV households account for a HUGE share of current broadband customers, and with the courts recently having struck down net neutrality, a much larger percentage of the US market is going to potentially have their content speeds throttled back if it competes with the content the cable company provides.
The issue here is not the TV programming, but the ways in which traffic is carried on the network.  Put net neutrality back in place, and this merger would likely sail through - and probably should from a purely regulatory standpoint.  But without the doctrine of net neutrality, this becomes an anti-competitive merger, and that's where the problem is.

I found this to be an interesting article.

Why is American internet so slow?

The country that literally invented the internet is now behind Estonia in terms of download speeds
http://theweek.com/article/index/257404/why-is-american-internet-so-slow

"Susan Crawford argues that "huge telecommunication companies" such as Comcast, Time Warner, Verizon, and AT&T have "divided up markets and put themselves in a position where they're subject to no competition."

How? The 1996 Telecommunications Act — which was meant to foster competition — allowed cable companies and telecoms companies to simply divide markets and merge their way to monopoly, allowing them to charge customers higher and higher prices without the kind of investment in internet infrastructure, especially in next-generation fiber optic connections, that is ongoing in other countries. Fiber optic connections offer a particularly compelling example. While expensive to build, they offer faster and smoother connections than traditional copper wire connections. But Verizon stopped building out fiber optic infrastructure in 2010 — citing high costs — just as other countries were getting to work.

Crawford told the BBC:


We deregulated high-speed internet access 10 years ago and since then we've seen enormous consolidation and monopolies... Left to their own devices, companies that supply internet access will charge high prices, because they face neither competition nor oversight. [BBC]

If a market becomes a monopoly, there's often nothing whatever to force monopolists to invest in infrastructure or improve their service. Of course, in the few places where a new competitor like Google Fiber has appeared, telecoms companies have been spooked and forced to cut prices and improve service in response to the new competition. But that isn't happening everywhere. It's very expensive for a new competitor to come into a market, like telecommunications, that has very high barriers to entry. Laying copper wire or fiber optic cable is expensive, and if the incumbent companies won't grant new competitors access to their infrastructure, then the free market forces of competition don't work and infrastructure stagnates, even as consumer anger and desire for competition rises due to poor service."

L.A. sues Time Warner Cable over past fees

The city of Los Angeles alleges Time Warner Cable owes franchise fees over four years through 2011. The city seeks nearly $10 million.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-time-warner-cable-lawsuit-20140315,0,6140488.story#ixzz2w2loNMTk

"
The city contends that once in 2008 and again in 2011, Time Warner Cable withheld more than $5 million in fees the city said it was owed. The company finally paid a portion of the disputed fees, Feuer said, but then subtracted the same amount from its franchise fee payment, resulting in another underpayment.

The lawsuit comes just a few weeks after Time Warner Cable alerted its Southern California customers that it planned to hike rates by an average of about 6% a month for homes that are not covered by a promotional package.

The higher bills, which are expected to affect about 30% of its estimated 1.5 million customers in the region, kick in this month. The company said higher fees are needed to pay for rising programming costs and technical upgrades to the company's system.

Meantime, Time Warner Cable has been playing hardball with DirecTV, Dish Network, Charter Communications, AT&T Inc.'s U-Verse, Cox Communications and Verizon Communications Inc.'s FiOS over terms to carry the new Los Angeles Dodgers channel.

The new channel launched on Time Warner Cable and Bright House Networks systems late last month. However, most other pay TV distributors have been balking at the terms for providing the channel, contending that Time Warner Cable is demanding fees that are too high.

Until this season, Dodgers games were available in Los Angeles on local television station KCAL-TV Channel 9 and Fox's Prime Ticket regional sports cable network."

https://staciehuckeba.wordpress.com/2014/06/14/an-open-letter-to-comcast-xfinity/

Quote from: bayonetbrant on June 19, 2014, 05:35:49 AM
https://staciehuckeba.wordpress.com/2014/06/14/an-open-letter-to-comcast-xfinity/

Priceless!  ;D

I think the problem is the size of the country, which allows few large players to divide up the regions and charge whatever they want. In the UK we have competition between SKY (NewsCorp), Virgin, BT, for a total package of Phone/Internet/TV plus there are other players in the phone/Internet field. Cable has practically disappeared in favor of satellite (SKY) or fiber (Virgin/BT).