Cable Merger Dissent Grows

The public outcry over media consolidation may be picking up steam, judging from a flood of comments that poured into the Federal Communications Commission this week.

The agency received some 10,000 e-mails Wednesday objecting to the acquisition of Adelphia Communications Corp. by the nation’s two leading cable TV providers -- Time Warner Inc. and Comcast Corp.

FCC officials say the outpouring of disapproval was unusual for a media merger and was more commonly associated with issues such as media ownership.

Despite the objections, however, analysts said regulators were unlikely to block the $17.6-billion deal, which was struck in April pending approval of regulators and the Bankruptcy Court. Adelphia filed for bankruptcy protection three years ago amid an accounting scandal.

The deal would make Time Warner the largest cable provider in Southern California while giving Comcast more customers in Ohio, Pennsylvania, Washington and Florida. Both companies have argued that the operating efficiencies gained by growing larger would accelerate the roll out of telephone and other advanced services.

Yet Free Press, the Northhampton, Mass.-based advocacy group that organized this week’s e-mail campaign, maintains that the deal would lead to “higher consumer rates and lower quality service,” according to a form letter it encouraged its members to send the FCC.

Since passage of the Telecommunications Act of 1996, when cable was deregulated, “consumers have seen their rates jump an average of 59%,” the letter stated.

Free Press, whose mission is to involve the public in media policymaking, sent e-mails this week urging its 210,000 members to object both to the Adelphia transaction and to any further easing of cable ownership rules, spokesman Craig Aaron said.

As of late Wednesday, the FCC had received more than 14,000 comments from the public objecting to further deregulation of the cable industry, which the commission will soon consider.

Although comments regarding the Adelphia transaction were due last week, the deadline for responding to cable ownership rules is Aug. 8.

Aaron said that Free Press was one of the consumer organizations behind a 2003 campaign that bombarded the FCC with 2 million e-mails opposing further broadcast deregulation. Under public pressure, Congress struck down rules the FCC had proposed to allow broadcasters to own more TV stations.

Aaron said the group was now expanding its efforts to cable.

“Fed up with rate hikes and lousy service? Don’t let the cable giants get even bigger. Tell the FCC now,” said a box on the Free Press website Wednesday. Clicking the box allowed members to send a form letter to the FCC objecting to both the Adelphia deal and further cable consolidation.

The FCC is gearing up to review rules prohibiting any one cable provider from serving more than 30% of the nation’s TV households. The rules were thrown out by the courts several years ago as arbitrary.

The Adelphia deal would give Comcast nearly 24 million subscribers, or about 26% of the nation’s 92 million pay-TV customers, while giving Time Warner more than 13 million customers, or a 15% market share.