Comcast / Time Warner Merger on the Rocks

[BvBPL]

You heard it here, first!

The FCC has some concerns over the purposed Comcast / Time Warner merger. Now scuttlebutt has it that the plug is going to be pulled on the merger.

 

[sophie]

Live feed from Comcast CEO's car/submarine/jet:


Link to video.

 

[Antilogic]

I heard on Democracy Now! last week they had not come up with a backup plan to address the FCC concerns. Article mentions a public statement tomorrow confirming whether they back away.

 

[gay_Aleks]

Live feed from Comcast CEO's car/submarine/jet:


Link to video.

Except that Gadget is probably more competent than several organisations. Probably more honest, too.

 

[SS-18 ICBM]

It wasn't an automatic "no" reply to this potential monopoly?

 

[sophie]

It wasn't an automatic "no" reply to this potential monopoly?

Of course not. This is America.

 

[Sonereal]

I think the somewhat public outcry combined with the actual implications of a merger forced the FCC leadership to do an about face turn on the issue. Before, I thought the chances of the merger were about 50/50, but after the outcry and the talk the last few months, it does look dead in the water.

Another (actually decent) article on the issue said this.

Justice officials are said to be wary of attempting to address the agency’s concerns through “behavioral remedies,” or pledges by Comcast that it will conduct business in a certain way.

This is important because, previously, decisions were made regarding actions such as these on promises made by companies that they won't conduct themselves in certain ways and, almost always, these promises were broken. If the only way Xfinity and TWC can merge is by both spinning off significant portions of their companies, then I don't see the merger outweighing the costs even if that plan was approved.

 

[Zkribbler]

Corporate mergers have completely [*****] our economy: less competition leads to poorer quality goods and services and also to higher prices and less innovation. Plus, there's usually a gush of lay offs. No good could have come from the merging of these two evil empires.

 

[jackelgull]

Monopolies actually tended to provide cheaper goods of higher qualities. At least in 19th century America that was true.

 

[downtown]

Yeah, so this is awesome, but now Comcast has a ton of cash that they can't invest, so they're probably going to look at buying other companies.

 

[Zkribbler]

Monopolies actually tended to provide cheaper goods of higher qualities. At least in 19th century America that was true.

This seems to be against human nature, selling quality goods which cost more for less than the price of shoddy goods. This would lessen profits. Why would any business do this?

 

[BvBPL]

Looking like Timer Warner and Charter might team up now.

 

[jackelgull]

This seems to be against human nature, selling quality goods which cost more for less than the price of shoddy goods. This would lessen profits. Why would any business do this?

The average price of kerosene outside of the monopoly was 23 cents per gallon, while Rockefeller's Standard Oil's prices were 9 cents per gallon. This is because larger companies have lower production costs. It's a concept known as economy of scale.

 

[LamaGT]

The average price of kerosene outside of the monopoly was 23 cents per gallon, while Rockefeller's Standard Oil's prices were 9 cents per gallon. This is because larger companies have lower production costs. It's a concept known as economy of scale.

The problem with monopolies is not that they necessarily raise prices, it's that they are in total control over their segment. They can charge less, but they can also charge way more for a crappier service. Given Comcast's track record, you can be damn sure they're going to do the latter (indeed in low coverage areas that's already happening)

 

[Zkribbler]

The average price of kerosene outside of the monopoly was 23 cents per gallon, while Rockefeller's Standard Oil's prices were 9 cents per gallon. This is because larger companies have lower production costs. It's a concept known as economy of scale.

This is called driving your competition out of business, so that you can raise your prices even more.

 

[Tahuti]

The problem with monopolies is not that they necessarily raise prices, it's that they are in total control over their segment. They can charge less, but they can also charge way more for a crappier service. Given Comcast's track record, you can be damn sure they're going to do the latter (indeed in low coverage areas that's already happening)

The problem is largely one of mentality, not lack of competition.

If competition is the only thing that keeps you from producing crappy goods or service, then you had quite a crappy mentality to begin with. For all the evocations of cuthroatness when the name J.P. Morgan is mentioned, he was still significantly better than whoever is in power at Comcast. The markets may have been less restrained, the mentality was less capitalist too.