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Senators skeptical of Comcast merger

A Senate Judiciary Committee assessed whether the $45 billion Comcast merger with Time Warner Cable would create a "nationwide octopus with tentacles" that…

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This week's Senate Judiciary Committee hearing on the proposed Comcast $45 billion merger with Time Warner Cable ended without resolving the question of whether or not the merger would benefit consumers. Comcast executive David Cohen maintained that the merger would be good for market competition. Consumer advocate Gene Kimmelman said it would consolidate the company's power, transforming it into "a nationwide octopus with massive tentacles."

The three-hour hearing took place the same week that Consumerist, for the second time, named Comcast the worst company in America.

"While this transaction will make us bigger, that's a good thing, not a problem," Cohen told the crowd and U.S. Senators at the hearing, arguing that when Comcast grows, competitors like AT&T are forced to innovate and improve. However, competitors like AT&T do not own media giants like NBCUniversal. While some Senators focused concern on the monopoly aspect of the merger, others expressed doubt at furthering the companies ability to vertically integrate. 

Comcast officials pointed out that the Time Warner Cable markets do not overlap with Comcast's markets. 

Sen. Al Franken (D-Minn.) argued that if the merger went through, the new Comcast would dominate TV and internet service in all but one of the top 20 markets, allowing the company to institute fees on content providers and elevate its own content from NBCUniversal. While the company agreed to be regulated by the FCC to uphold "net neutrality" as part of a deal to merge with NBCUniversal three years ago, the condition expires in 2018.

Another condition from Comcast's last merger was an agreement to provide more accessible internet to those who cannot afford the average rate, starting around $30 a month—a rate significantly higher than what is charged in similar countries. However, in cities like Philadelphia, just 9 percent of those eligible for Comcast's accessibility program, Internet Essentials, has participated. The program excludes low-income families without children.

According to the FCC, there isn't much competition in the market already when it comes to broadband choices. More than two out of three Americans have just one or two options. One out of three Americans has no option. University of Pennsylvania technology law professor, Christopher Yoo, testified in favor of the merger, citing that 98 percent of Americans have three or more choices for internet providers.

According to Reuters, justice departments across the states are reviewing the merger to determine its legality under the federal antitrust law.

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