Rep. Tony Cardenas (D-Los Angeles) on Wednesday became one of the first members of the U.S. House to publicly oppose a proposed merger of Comcast Corp. and Time Warner Cable.
“I ask the [Federal Communications Commission], the [U.S. Department of Justice] and the California Public Utilities Commission to deny this merger because it is bad for consumers, will harm competition, will lead to less diverse content and more expensive cable and Internet access, and will eliminate good jobs in California,” Cardenas said in a presentation at the Writers Guild of America, West, in Los Angeles.
The FCC and the U.S. Department of Justice are reviewing the Comcast-Time Warner Cable merger, which would include nearly 1.8 million homes in the Los Angeles region. The government agencies are trying to assess whether the combination of the nation's two largest cable companies is in the public interest and whether it poses a threat to competition. The FCC is expected to make a decision by the end of March.
But Cardenas said the merger would give Comcast too much control over the Los Angeles market, leading to higher costs for Internet users and cable TV customers and less programming from independent television providers. Comcast already owns the NBC, Telemundo, Universo and TeleXitos networks.
Cardenas added that the merger could also have damaging consequences for L.A.'s key entertainment industry, a theme echoed by Chris Keyser, president of the Writers Guild of America, West.
Keyser, who joined a panel of activists opposed to the merger, said Comcast is expected to wring savings after the merger by paying lower rates to cable companies, potentially threatening the new "golden age of programming."
Additionally, he said Comcast would control half of the nation's high-speed broadband market, allowing it to extract higher delivery fees from Netflix, Amazon and other new media outlets, lessening investment in new jobs at a time when Web productions are booming, he said.
“Mergers that increase the power of content gatekeepers do not serve the interests of consumers or creators,” Keyser said. “Comcast has already stated that if the merger is allowed, it will save money by paying less for content. This means that programmers will have less money to invest in content, which means less creativity, less innovation and less product. This could translate into fewer jobs, including right here in Los Angeles."
Comcast has disputed claims that the merger would lead to higher rates for consumers or lead to job losses. It has maintained that negotiating lower rates with cable programmers would only be necessary to offset rising programming costs and avoid raising rates for consumers.
The Philadelphia company has argued that the proposed merger should not be considered anti-competitive because Comcast and Time Warner Cable offer service in different geographic markets.
“The Comcast-Time Warner Cable transaction has undisputed benefits for consumers -- including faster Internet speeds, better video products, broadband programs for low-income Americans, more competition for small businesses, and better diversity practices, including more diverse programming for consumers," said Sena Fitzmaurice, a spokeswoman for Comcast Corp.
Comcast also cited support for the merger from several Latino groups, including the U.S. Hispanic Chamber of Commerce, and touted its contributions to the state's economy.
"We’re proud of our record in California," Fitzmaurice said. "We’ve invested throughout the state, from our cable systems in Northern and Central California, to our innovation center in Silicon Valley, to NBCUniversal’s facilities at Universal City, which has been transformed into a state-of-the-art media and entertainment space. Since the close of the NBCUniversal transaction in January 2011, we’ve created several thousand jobs directly in the creative and construction fields -- and more through the thousands of production jobs associated with our television and film production in California."