Comcast's decision to purchase Time Warner Cable would seem, on its face, to be exactly the kind of mega-merger that sets alarm bells going for media and business watchdogs. But Comcast CEO Brian Roberts appeared on CNBC on Thursday to assure people that, in fact, the deal was "pro-competitive" and "pro-consumer."
The deal was first reported late Wednesday night. Comcast, the biggest cable operator in the country, would pay about $45 billion to acquire Time Warner, the second-biggest cable operator in the country.
The two businesses don't compete in the same regions, but a Comcast purchase of Time Warner would give it access to the crown jewels of American media markets: New York and Los Angeles. It would also create a situation where a single company both creates a good chunk of the content Americans watch (since Comcast owns NBC Universal) and owns the platform on which an even bigger number of them watch it. And that's before you add in the crucial fact that both companies also control much of the broadband market in their respective areas.
Predictably, watchdog groups immediately protested the deal. Free Press president Craig Aaron said it would create a vast, unaccountable giant:
This deal would give Comcast control of more than a third of the U.S. pay-TV market and more than half of the U.S. triple-play market for video, voice and Internet service. Comcast will have unprecedented market power over consumers and an unprecedented ability to exert its influence over any channels or businesses that want to reach Comcast's customers.
No one woke up this morning wishing their cable company was bigger or had more control over what they could watch or download. But that — along with higher bills — is the reality they'll face tomorrow unless the Department of Justice and the FCC do their jobs and block this merger. Stopping this kind of deal is exactly why we have antitrust laws.
The deal is sure to draw some level of scrutiny from the FCC and other regulators, but Comcast CEO Brian Roberts told CNBC (a channel his company owns) that he didn't foresee any problems.
"It's a really special transaction," he said. "The deal is pro-competitive. It's pro-consumer." He said that, since Comcast doesn't overlap with Time Warner, there was "no reduction in competition." Roberts added that Comcast intends to shed 3 million customers to further satisfy regulators.