Free Press: Charter-TWC Tarnishes Wheeler Legacy

Reaction was mixed to the Justice Department's announcement it was OK with the Charter-Time Warner Cable merger, with conditions, and FCC Chairman Tom Wheeler's circulation of approval of the deal, with conditions.

Free Press was not sanguine about the prospects, laying some of the blame at Wheeler's feet. "“Chairman Wheeler has just tarnished his legacy as head of the FCC," said Free Press President Craig Aaron. "As he nears the end of his term, this wasteful merger undermines his oft-stated priority of ‘competition, competition, competition.’ I guess he decided it was time for a new mantra....“There’s nothing about this massive merger that serves the public interest. There’s nothing about it that helps make the market for cable-TV and Internet services more affordable and competitive for Americans."

The Stop Mega Cable Coalition, which was strongly opposed to the deal, appeared to be at least slightly assuaged by the conditions on access to over-the-top content and interconnections. But it signaled it still had issues it wanted the FCC to deal with before voting on the proposal.

“The conditions proposed by Chairman Wheeler represent an important first step towards protecting the interests of consumers and preserving competition in the cable and broadband marketplaces," the coalition said.

“While the draft order circulated today would target a number of key issues tied to Charter’s mega merger" -- the chairman signaled some of what was in it -- "it still falls short of addressing all of the threats to competition and consumers posed by this transaction. Among other things, the conditions proposed in the draft order do not fully prevent Charter from using its dominant position in the marketplace to thwart competition from over-the-top (OTT) streaming services and to stifle competitors in underserved, rural communities. For example, Charter should be required to offer a stand-alone broadband service that would enable consumers wishing to 'cut the cord' to have that option. As the merger review proceeds at the FCC, our members urge the Commission to consider the public interest above all, and to impose conditions that truly solve for the competitive harms presented by this merger.”

Stop Mega Cable Coalition members include Dish, Consumers Union and the Writers Guild of America, East and West.

The Writers Guild of America, West, would have been happier if the deal had been blocked, but was pleased with the conditions and their seven-year duration.

“The WGAW does not believe the merger of Charter, Time Warner Cable and Bright House Networks is in the public interest. However, we commend the Department of Justice and Federal Communications Commission for recognizing the harm to video competition presented by the merger and for imposing conditions to limit anticompetitive behavior.

One of the WGAW’s key concerns has been that the merger would significantly increase both the ability and incentive of the merged firm (New Charter) to use its market power to limit online video competition. In this case, the DOJ’s proposed conditions will limit New Charter’s ability to restrain programmers from licensing content to online video distributors (OVDs). Further, the FCC conditions prohibiting data caps and interconnection fees for seven years will help protect both content creators and consumers in this growing online market."

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.