Welcome to your new Internet monopoly
by David Atkins
I’m not an expert in telecommunications and anti-trust law, but not only does this seem like a terrible idea, I don’t understand how it could even be legal:
Comcast is set to buy Time Warner Cable in an all-stock deal that values Time Warner at $159 per share, CNBC’s David Faber reports on Twitter.
At $159, Comcast would be paying an 18% premium to today’s closing price. It would value Time Warner Cable at ~$45 billion. Comcast is valued at $146.5 billion.This would make one gigantic cable company.
Comcast is the biggest cable provider in the U.S. with 23 million subscribers. Time Warner is the second biggest with 12 million subscribers. The next closest is Cox with 4.6 million subs…
However, this is far from a done deal. It will come under heavy government scrutiny.
This would create the biggest pay-TV business by a mile. There’s not exactly a ton of competition in the world of cable, but this would effectively make it nonexistent.
If the FCC allows this to move forward, it’s hard to see what the FCC’s role is anymore.
On a broader level it’s a complicated issue, but the short version is that the taxpayers funded much if not most of the actual wiring infrastructure that makes up the Internet for which these companies charge. Moreover, the Internet is an absolutely essential commodity for doing business, no less important in many ways than water and electricity. No matter what the law says, it’s functionally a utility and public good at this point, and since taxpayers funded both its creation and most of its subsequent development, we deserve to reap the rewards. We don’t deserve one monopolistic behemoth seeking rents on all of us, particularly now that the courts have eliminated net neutrality.
A society that allows its taxpayer-funded public goods to be privatized, monopolized and vertically integrated is crazy, corrupt or both. It’s long past time to nationalize Internet services.
But since that’s not likely in the cards for a long time, the next best option (as in healthcare) is for saner, more progressive states and municipalities to enact their own taxpayer-funded free Wifi and broadband services.
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