New Streaming TV Services Could Weirdly Help Comcast
By Amy Schatz
Recode.net
March 22, 2015, 3:46 PM PDT
http://recode.net/2015/03/22/new-streaming-tv-services-could-weirdly-help-comcast/
News that Dish’s new Sling online TV service had already attracted more
than 100,000 subscribers (at least on a trial basis) would seemingly be
a bad thing for Comcast* and other cable companies, which have been
fighting to stem the flow of cord-cutters.
Weirdly, that’s not actually the case, at least for Comcast. The cable
giant needs all the competition it can get these days, as it tries to
convince regulators to approve its $45 billion deal to acquire Time
Warner Cable.
Sling and other so-called over-the-top streaming TV services from Sony
and Apple could be just what Comcast needs.
It has been more than a year since the deal was proposed, but Justice
Department and Federal Communications Commission officials still haven’t
made a peep about what they think of the deal. That could change in the
coming weeks, at least at the FCC.
Senior FCC officials have been obsessed for the past few months about
new net neutrality rules for Internet lines, which would prohibit
Internet providers, including Comcast, from blocking or slowing Internet
traffic or creating fast lanes for deep-pocketed content companies.
Now that the agency has released those rules, senior aides are turning
their attention to both Comcast’s deal to acquire Time Warner Cable and
AT&T’s deal to buy DirecTV. Two weeks ago, Comcast Executive Vice
President David Cohen met with senior FCC lawyers, arguing that “claims
raised in the proceeding that Comcast will gain greater leverage in
programming and interconnection negotiations as a result of the
transaction and will use it to harm online video distributors are
unfounded.”
Even though Comcast is expected to help challenge the net neutrality
plan — via the cable industry’s trade group — the rules actually
alleviate some of the concerns raised about the deal: That Comcast’s
large share of the consumer Internet market gives it too much power in
negotiations with smaller Internet companies and providers.
The rules allow the FCC to investigate any complaints from Netflix,
Amazon or other companies about reaching deals with Internet providers
to exchange traffic, an issue that Netflix has been very vocal about.
Those sorts of “peering” deals have been a major focus of Justice
Department and FCC lawyers, according to several people close to the
deal review.
If the net neutrality rules help ease some concerns about Comcast’s
dominance in the Internet market, the rise of new streaming TV
competitors could help on the pay-TV side of things.
Comcast’s main argument for why the deal should be approved is that it
doesn’t compete with Time Warner Cable in any markets. That’s true,
mostly because cable operators get franchises from local governments to
offer service and that has kept cable companies from competing directly
with each other.
Streaming TV services like Sling or Sony’s new Vue service offer
consumers tired of high cable bills a new source of competition
(although they still have to buy high-speed Internet service — most
likely from their local cable operator).
To help them, the FCC started the process of tweaking some rules to make
it easier for online TV providers to get some of the same legal rights
as more traditional cable or satellite TV providers.
Comcast lawyers have argued that new services like Sling or Apple’s
upcoming TV service show there’s plenty of competition in the market.
What remains to be seen, of course, is whether the federal government
agrees with them.
Opponents of the deal aren’t buying it and are already saying that the
FCC’s new net neutrality rules don’t make the Comcast deal any more
palatable.
At a congressional hearing last week, Democratic Sen. Richard Blumenthal
of Connecticut asked FCC Chairman Tom Wheeler about the new streaming TV
services, expressing his worries that the Comcast deal could decrease
cable competition.
“I’ve heard from so members of this committee about cable pricing and
these kinds of things. The answer is in competition. That competition is
coming over the top,” Wheeler told lawmakers. “It is coming over the top
through the Internet. It is one of the reasons why there has to be an
open Internet.”
“Historically, cable systems have chosen who will be on — I will take
this service, not that service,” he continued. “We cannot be in that
kind of situation if we want true video competition.”
--
=================================================
George Antunes Voice (713) 743-3923
Associate Professor Fax (713) 743-3927
Political Science Mail: antunes at uh dot edu
University of Houston
Houston, TX 77204-3011
_______________________________________________
Medianews mailing list
[email protected]
http://etskywarn.net/mailman/listinfo/medianews_etskywarn.net
