Although described by the media as a merger, the $45 billion deal was actually Comcast buying Time Warner Cable. The Washington Post provides some insider insight into why the deal failed and further examples of how Comcast has used its position to stifle competition and says the deal "would have combined the two largest cable providers in the country and would have put more than half of all high-speed Internet customers under one company."
Some people are beginning to wonder whether the explosion of wireless means cable's days are numbered, but as of now Comcast has a lot of power and the merger's defeat can only be seen as a good thing for the internet.
In late February, following an extended campaign by net neutrality groups, the FCC announced it would regulate internet service providers like Comcast as "common carriers," which means putting them under the strict regulatory regime that controlled the old telephone companies. This was seen as a huge win for the internet and thwarted what had been only the most recent of several attempts by big internet providers like Comcast to privatize the internet.
House Republicans immediately filed legislation to try to prevent FCC from issuing the new rules, then, when the rules were published this week, all the big cable and internet providers, individually or through their front groups, filed law suits to try to prevent them from taking force. Filing lawsuits so far have been:
CTIA (cell phone company trade group)
US Telcom (cable company trade group)
American Cable Association (cable company trade group)
FCC Chair Tom Wheeler, an Obama-appointed former cable company lobbyist who surprised everyone in late February by suddenly siding with the commission's Democrats in favor of net neutrality, which led to the issuing of the new "common carrier" rules this week, says he thinks the FCC can win the lawsuits.
As reported by Opposing Views, Wheeler issued a statement after the Comcast Time Warner Cable deal was called off:
"Comcast and Time Warner Cable's decision to end Comcast's proposed acquisition of Time Warner Cable is in the best interests of consumers,” Wheeler said. “The proposed transaction would have created a company with the most broadband and the video subscribers in the nation alongside the ownership of significant programming interests.
"Today, an online video market is emerging that offers new business models and greater consumer choice," he continued. "The proposed merger would have posed an unacceptable risk to competition and innovation, including to the ability of online video providers to reach and serve consumers.
"I am especially proud of our close working relationship throughout the review process with the Antitrust Division of the Department of Justice," Wheeler added. "Our collaboration provided both agencies with a deeper understanding of the important issues of innovation and competition that the proposed transaction raised."
In other words, the justice department heard the side of consumers and not just of big business. Strange things happen.