Cable Association Calls for DOJ Antitrust Investigation into Comcast

US cable company Comcast is reportedly considering relaunching a bid to acquire 21st Century Fox even as Disney works to complete a $66.1 billion acquisition of part of Rupert Murdoch's empire (AFP/File DAVE CLARK)
AFP/File DAVE CLARK

The American Cable Association (ACA) sent a letter to the Department of Justice (DOJ), urging the agency to open an antitrust investigation into Comcast’s dominant position in the cable and television market and citing “substantial competitive harm” it already provided to consumers.

The ACA sent a letter On November 6 to Makan Delrahim, the DOJ’s assistant attorney general for the Antitrust Division, to investigate the alleged anticompetitive practices of Comcast-NBCU, claiming that as the cable giant’s dominant position in the cable and television market, it can act with “impunity,” which harms both consumers and rivals.

The ACA serves as a trade association for small and medium-sized independent companies that provide broadband, phone, and video services to eight million Americans for rural and suburban markets across America.

Matthew Polka, the ACA president and CEO, said in a statement on Monday:

By opening a formal investigation, the DOJ, which has already put Comcast-NBCU on notice, can take the next step to gather facts about the company’s activities and ensure consumers and competition are protected. Given the enormity of Comcast-NBCU’s market presence and incentive to engage in anticompetitive harm, such an investigation is fully warranted.

The DOJ has appealed the AT&T-Time Warner merger over concerns that the merger will inhibit competition. Both AT&T-Time and Comcast-NBCU are vertical mergers, meaning that the deals involve the combination of a content producer with a content distributor.

The ACA believes that Comcast’s merger with NBC serves as a greater risk to competition and consumers than the AT&T-Time Warner merger. Comcast owns 11 local news channels and several regional sports networks, which give the company more leverage to inflate prices over regional competitors.

The cable association also pointed out that Comcast has already violated antitrust laws repeatedly by withholding “must-have” programming from local stations, threatening to raise prices on rival cable distributors and refusing to carry certain channels.

The ACA noted:

For instance, Comcast-NBCU used its deep pockets to engage in delaying tactics that forestalled compliance with the condition that it carry Bloomberg TV in a news channel neighborhood with Comcast-NBCU’s CNBC. Comcast also refused to offer standalone broadband Internet access service as the FCC condition required.

The ACA contended that many member organizations fear that the Comcast-NBCU may restrict their customers’ access to Hulu, an online video platform, as an alternative to Comcast’s cable offerings. Many small and medium-sized cable providers stated that their customers often prefer online video platforms to traditional video services such as Comcast’s Xfinity television program platform.

Activist and consumer groups across the political spectrum, such as the conservative Americans for Limited Government to the National Grange, have voiced concerns about the Comcast-NBCU’s anticompetitive conduct and have called for the DOJ to intervene.

Rick Manning president of Americans for Limited Government, said in a statement in October, “Our concerns are now amplified by the fact that Comcast-NBCU has recently been set free from merger restrictions they once had to abide by.”

“Mass media consolidation is slowly but surely warping alternative, important voices, with important long-term implications related to basic First Amendment freedoms,” Manning concluded.

President Donald Trump tweeted about the ACA’s complaint regarding Comcast’s alleged anticompetitive practices, citing Fox Business Network’s Charlie Gasparino.

Trump wrote:

American Cable Association has big problems with Comcast. They say that Comcast routinely violates Antitrust Laws. “These guys are acting much worse, and have much more potential for damage to consumers, than anything AT&T-Time Warner would do.” Charlie Gasparino:

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