Hardly a surprise that the government isn’t a big fan of “America’s Worst Company.”
Comcast has the opposite of the King Midas problem: everything this organization touches turns to pyrite, causing the necks of every user to turn a hideous shade of green.
For what seems like a millennia (it’s only been a year), Comcast and Time Warner Cable have been trying to gather at the same Thanksgiving table and break bread for a reported $45.2 billion. Only problem is the Federal Communications Commission (FCC) and the U.S. Department of Justice (DOJ) are getting closer to putting the kibosh on this entire thing in the interests of everyone who isn’t TWC or Comcast.
Based on a report from Bloomberg, DOJ attorneys “are leaning against the merger out of concern that consumers would be harmed.”
Renata Hesse, a deputy assistant attorney general for antitrust, will take the analysis and ultimately decide, along with the division’s top officials, whether to bring a case to block the merger, they said.
How would they be harmed and why would Heese give the proposed mega-company the Heisman? The answer lies in the power of the Internet broadband market. The combined company would have unfair competitive leverage against TV channel owners and businesses offering online video programming.
Cue Comcast damage control (because that’s been effective in the past):
“There is no basis for a lawsuit to block the transaction,” said Sena Fitzmaurice, a Comcast spokeswoman. The merger “will result in significant consumer benefits — faster broadband speeds, access to a superior video experience, and more competition in business services resulting in billions of dollars of cost savings.”
Time Warner? What say you?
A Time Warner Cable spokesman, Bobby Amirshahi, said “we have been working productively with both DOJ and FCC and believe that there is no basis for DOJ to block the deal.”
And although a merger has not been announced yet, shares for both Comcast and TWC fell by $1.25 per share and 5.4%, respectively, on Friday. And negotiations between the two government agencies and the M&A hopefuls have ceased.
Would you expect anything less?