THE BLOG
06/26/2014 10:37 am ET Updated Aug 26, 2014

The Dangers of the Comcast Time Warner Merger

As New York City's elected Public Advocate and Chair of the Commission on Public Information and Communication (COPIC), it is my duty to represent and inform the public on relevant changes in communications technology and the effects any such changes may have in our communities.

The proposed Comcast-Time Warner Cable merger has the potential of carrying considerable implications for New York City consumers.

Prior to rendering a decision, the Public Service Commission must thoughtfully deliberate the effects that the proposed merger would have on our community to ensure that the needs of our people are best served by any changes that would -- or could -- result.

This deal would merge Comcast Corporation, which is not only the biggest cable company in the U.S.; it is also the largest media provider in the world, with Time Warner Cable, the second largest cable company in the country.

This merger is extremely concerning to any reasonable person with respect to the effects of non-competition on Internet and cable customers, as it will likely diminish what is already minimal competition for high-speed Internet.

Currently, U.S. consumers pay more for broadband Internet access than those in most other developed countries, yet more often than not we receive inferior services with respect to speed and reliability.

Specifically in large urban hubs such as New York City, Los Angeles, and Washington, D.C., residents pay inflated prices for slower Internet service.

In New York City, competition for services is essentially non-existent, offering customers no option whatsoever and essentially forcing the patronage to a sole provider, which is primarily Time Warner Cable.

Accordingly, within New York City, Time Warner Cable can name its price for cable services without threat of competition and little incentive to ensure that service is provided well.

In addition, apart from cable and Internet customers, Time Warner Cable and Comcast already have the vast majority of power to set prices on transit and content providers -- some of whom are direct competitors of content providers owned by Comcast, which certainly sounds ripe for an abuse power by Comcast towards non-Comcast owned content providers.

Comcast recently acquired NBC-Universal and this merger would consolidate two content empires.

Furthermore, if the merger were to succeed, the interconnection market -- where Comcast already has tremendous control -- would be undoubtedly altered, possibly facilitating Comcast to gain additional leverage in demanding higher payments from transit companies.

We must ensure that any approved agreement does not impact the quality and capacity of Internet and cable services for New York City consumers.

Moreover, as this merger is considered, we must assess how our most underserved communities would be impacted. How will this transaction impact the digital divide, which primarily affects low-income and marginalized communities?

We must analyze the possible short and long-term social and economic implications of such a decision.

Internet Service Providers are currently able to charge consumers inflated prices as a result of poor competition. It is possible the merger would only lead to additional price increases, completely shutting-out families and individuals already facing difficulty paying for the service. Low-income communities would therefore be disproportionately excluded from accessing what is now considered a basic form of infrastructure in our society and means of communication.

In today's world, access to the Internet is inarguably critical to function in informal and formal spaces -- and the costs to digital segregation are rising.

The Internet serves as a channel of endless information through which individuals now access the news, employment opportunities, education, entertainment, etc. If accessing the Internet becomes more difficult for low-income communities, academic and employment competition may be undermined, and could damage the prospects of upward mobility for low-income New Yorkers and further exacerbate income inequality.

If the merger were to pass, Comcast's Internet Essentials programs for low-income consumers currently at a cost of $9.95/month, would be extended to New York City residents.

However, many claim the program is being difficult to access because of cumbersome criteria. Additionally, the program evidently offers second-class Internet quality and speed -- 5 megabits per second for Internet Essentials compared to 12 megabits per second for regular-paying consumers.

In Philadelphia, for example, where Comcast is headquartered, the program has seen low participation rates and has even caused protests.

Comcast is therefore accused of using Internet Essentials as a public relations scheme in order to have the merger granted, while it simultaneously gains increased profits by acquiring low-income customers in areas in which their service already exists. As a starting point in addressing such concerns, the merged company should provide free service to low-income individuals.

The merger should also include a component for local hiring and job training for low-income individuals, specifically in NYCHA and subsidized public housing. Additionally, free Wi-Fi should be provided in many more New York City parks, including City playgrounds and public schools.

There is also an opportunity for Time Warner and Comcast to modify their Terms of Service to allow people to securely share their Wi-Fi connection with neighbors or others within range- without jeopardizing profits.

The merger cannot allow either company to breach current public good contracts, such as Time Warner's contract to support Public Access in exchange for their cables running in public-rights-of-way.

On the contrary, public access channels should be expanded and diverse and educational programming should be made a priority. Providers must also accelerate deployment of high-speed Internet to digitally underserved communities.

I urge the Public Service Commission to investigate these issues.

Transparency and accountability are imperative in the process and New Yorkers demand the best and most competitively priced services.