FCC Approves Merger to Create Price-Gouging Cable Giant

According to several news reports, the Federal Communications Commission has voted to approve Charter Communications' $90 billion takeover of Time Warner Cable and Bright House Networks.

The merger combines the nation's second-, third- and sixth-largest cable-TV and Internet providers. After the merger closes, two Internet service providers, Charter and Comcast, will control nearly two-thirds of the nation's high-speed Internet subscribers.

Earlier reports and statements from the FCC suggested that various seven-year merger conditions would apply to the deal. According to a statement from Chairman Tom Wheeler, the conditions include bans on data caps for broadband customers and interconnection fees for online services, including video providers.

Free Press President and CEO Craig Aaron made the following statement:

"This wasteful and costly merger undermines Chairman Wheeler's oft-stated priority of competition, competition, competition. It hands far too much control over the Internet's future to a cable giant with the incentive and capability to gouge its customers with higher and higher prices. It gives cable monopolists like Charter and Comcast the power to throttle the nation's burgeoning video market and stifle innovation at the edges of the network.

"Americans want more choices for open and affordable broadband connections. High-speed Internet access is essential for anyone seeking to improve their educational opportunities, participate in politics, seek out health care, do their job or find a new one. Yet there's nothing about this massive merger that will make meeting these vital needs any easier. Instead, it will saddle customers with higher prices as Charter attempts to pay off its $60 billion debt load, which includes the nearly $27 billion in new debt it took on just to finance this deal.

"Many working families already struggle each month to pay sky-high broadband bills. Nothing in the reported conditions will lower those prices for the people these rate hikes will hit hardest: low-income households, people of color and other underserved communities. Families will be forced to make hard choices about basic necessities, and getting online will be impossible for far too many.

"Americans now face the grim reality of a marketplace where Charter and Comcast have unprecedented control over our cable and Internet connections. Their crushing power will mean fewer choices, higher prices, no accountability and no competition. The temporary conditions attached to the merger do too little to remedy these harms.

"The best way to confront cable monopolies isn't with inadequate and unenforceable merger conditions, but by ensuring universal and affordable access to big, open pipes, with network owners barred from discriminating against the content that flows over them. Approval of the Charter merger moves us in the opposite direction, toward an Internet and pay-TV landscape dominated by an even smaller number of cable gatekeepers. The FCC needs to stop approving mega-mergers and start getting serious about policies that protect openness, promote affordability and spur competition."