Tags: Comcast | Time | Warner | Sports

Comcast/Time Warner Merger Bad for Sports Fans

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Friday, 04 Apr 2014 09:57 AM Current | Bio | Archive

The American sports fan needs to pay attention to the proposed huge cable merger between Comcast and Time Warner Cable. The merger could have serious implications for the cost and availability of sports for fans everywhere.
 
To get a preview of American sports if the FCC and Department of Justice approve the deal, just ask fans in Philadelphia and Portland: If you don’t pay Comcast top dollar, you probably won’t get your games.
 
I testified back in 2009 as a Sports Fans Coalition Board member before the Oregon state legislature about the way that Comcast was preventing Trailblazers fans that did not get Comcast from seeing their team play. For rural homes outside Comcast’s service area and satellite TV subscribers, this meant being cut off from Portland’s only professional sports team.
 
At about the same time, Sports Fans Coalition heard from college students in Philadelphia that because their dorm didn’t get Comcast cable, the only way students knew if the Phillies had hit a home run was seeing fireworks over the stadium.
 
The merger with Time Warner Cable would just make this problem worse. Sports fans everywhere should be alarmed.
 
We have already seen Comcast squeeze competition when it comes to sports. They either use ownership or exclusive contracts of important channels to freeze out rivals or increase their costs. When Comcast took over of the Philadelphia market, Comcast relied on local demand for Phillies, Flyers, and 76ers games to depress satellite competition and thereby maintain high prices.
 
Comcast has repeated the regional-sports strategy across the country; if it gains unfettered control over Time Warner, Comcast can simply reuse the strategy in its new territories.
 
If the merger goes through, this strategy will be magnified in many of America’s largest sports markets, including New York, Los Angeles, and Houston, not to mention Milwaukee and other mid-sized markets.
 
Comcast and Time Warner are already equity partners in the Major League Baseball Network and charter distributors of the Pac 12 fleet of networks. NBC Regional Sports Networks’ (owned by Comcast) current 10-channel roster, with additions in L.A., will soon have Regional Sports Networks in nine of the top 10 markets.

The merger will allow the new cable behemoth to leverage this control over sports programming into higher-priced exclusives for their own cable subscribers, leaving everyone either paying more or seeing less in the sports category.
 
Let’s not forget that sports arenas often are built with taxpayer dollars and sports leagues enjoy multiple breaks, waivers, and other benefits under the law. The NFL, for example, enjoys non-profit tax status under the Internal Revenue Code and all professional sports leagues get antitrust exemptions under federal law.

With all this government largess flowing to sports leagues, fans have every right to insist that the games be made available to the most people possible. Comcast’s past practices suggest that this just would not be the case, especially if it were to acquire Time Warner Cable.
 
This merger will also impact high school and local college sports coverage. Cable often is the only source of local high school and college sports programming. If the merger goes through, executives in Philadelphia skyscrapers will control parents’ ability to watch their high school kids’ games in communities as far away as Wisconsin and Texas.
 
The problems would not be limited to cable TV. A combined Comcast/Time Warner Cable would be by far the largest residential broadband provider in the U.S. As more and more sports move to online video, the merged company would have unprecedented control over fans’ ability to watch their games online. Control over this Internet gateway would allow the merged companies to “Comcastize” online sports video the same way they will sports on television.
 
Speaking of television, fans can expect more and more games to migrate off free over-the-air broadcast and onto pay platforms. Comcast owns NBC/Universal, including NBC Sports and all of NBC’s sports channels. If it makes more money for the giant cable operator, you can bet that the merged entity will move games off broadcast and onto cable networks, regional sports networks, and online video platforms owned by Comcast. For fans that rely on broadcast TV to watch sports, kiss your games goodbye.
 
The merger is subject to government approval. The Federal Communications Commission is the lead government agency tasked with the job of approving or denying Comcast’s application. The FCC, by law, is only supposed to approve a merger if it finds that it serves “the public interest.” Given recent history, and in today’s cable business, the public’s interest can be captured in two words: “lower prices.”
 
The FCC, in fact, is supposed to ensure that cable prices are “reasonable.” Here’s a simple rule of thumb: unless the FCC thinks that there is a realistic chance that the deal will reverse two decades of rising prices, it should stop the merger.
 
Comcast, in announcing its deal, has said nothing about how it might save consumers money or improve service and access. Quite the opposite. David Cohen, Comcast’s top executive in charge of lobbying, said that no one should expect rates to go down as a result of this deal. Instead, Comcast calls the deal “an exciting opportunity” for its customers, promising “accelerated deployment of existing and new innovative products and services.”

I suspect that I’m not alone in thinking that a lack of excitement isn’t what most customers call to complain about. Everyone, even people in the industry, knows that cable prices are high. Nowhere in any of its materials released in favor of the merger does Comcast suggest what economic effect it will have on consumers. Where is the “public interest” that is served by this merger?
 
Among household expenses, few things have risen quite as quickly as the cable bill. As recently as the 1990s, cable prices ranged from $7 to $11.50 per month. After years of price hikes, a decent cable package is now over $60 a month; the average cost is $86. Comcast, in 2013, collected about a $156 a month on average, per customer — and some people are paying much more than that.
 
Outpacing inflation, cable is now so expensive that it creates poverty issues: In poorer households it competes with basics like food, rent, or health insurance. If you wanted to help the poor, you could do worse than cutting cable bills.
 
The Comcast-Time Warner Cable merger would create a mega-empire in an industry that is already dominated by a few huge companies. For this reason alone the deal should be denied. But when it comes to sports, make no mistake: This deal is a foul ball for sports fans.
 
Bradley A. Blakeman served as deputy assistant to President George W. Bush from 2001-04. He is currently a professor of politics and public policy at Georgetown University and is a Board Member of Sports Fans Coalition and a frequent contributor to Fox News Opinion. Read more reports from Bradley Blakeman — Click Here Now.
 
 
 
 

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BradleyBlakeman
The American sports fan needs to pay attention to the proposed huge cable merger between Comcast and Time Warner Cable. The merger could have serious implications for the cost and availability of sports for fans everywhere.
Comcast,Time,Warner,Sports
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2014-57-04
Friday, 04 Apr 2014 09:57 AM
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