Comcast is in the process of swallowing Time-Warner. AT&T has just announced they’re purchasing DirecTV. Maybe I just haven’t looked closely enough, but where is the benefit to citizens?
The biggest trend in American business over the past few decades has been consolidation. Much of it is subject to regulatory approval. It should be subject to regulatory scrutiny. That part seems sorely lacking.
Comcast wishes to become a vertically integrated behemoth. They will dictate programming and technology because their fingers are in every pie.
Even today they double dip, charging Netflix for services I’m already paying for. That’s what monopolies do! How can you say no to the company that stands between you and your customers?
Comcast as every incentive to do more of the same, protecting their legacy businesses through the terms they offer consumers.
Will programming and distribution deals be structured, as many are now, to protect Comcast’s cable TV business? Why do I even ask?
There was a time in America when bigger was better. Charles Erwin Wilson, nominee for Secretary of Defense in the early 1950’s famously tried to hold onto his GM stock while in office¹.
Because for years I thought what was good for our country was good for General Motors, and vice versa.
And maybe, sixty years ago, it was. Employment scaled up as company’s did.
Is there anyone who actually believes the Comcast or AT&T acquisitions will have a positive outcome for America? More choice? More employment? More investment? Better technology?
“This compelling and complementary combination will bring significant benefits to all consumers, shareholders and DIRECTV employees,” said Mike White, president and CEO of DIRECTV. “U.S. consumers will have access to a more competitive bundle; shareholders will benefit from the enhanced value of the combined company; and employees will have the advantage of being part of a stronger, more competitive company, well positioned to meet the evolving video and broadband needs of the 21st century marketplace.” – AT&T press release
The important part is there in the last sentence:
a stronger, more competitive company, well positioned
We’re already dealing with companies treading very close to the anti-trust line. Take the bundling of cable TV services, where I have to buy loads of channels I don’t want to get the ones I do.
Typically, the “tied” product may be a less desirable one that the buyer might not purchase unless required to do so, or may prefer to get from a different seller. If the seller offering the tied products has sufficient market power in the “tying” product, these arrangements can violate the antitrust laws. – Federal Trade Commission
The system is being gamed and these mergers and acquisitions will only make things worse. It’s time to put a stop to it.
¹ – He sold his stock before his appointment, but after his confirmation hearing.