Sen. Al Franken (D-Minn.) told regulators this week that Comcast’s history of violating merger commitments “raises serious questions” about whether the company’s proposed acquisition of Time Warner Cable will benefit consumers.
The Federal Communications Commission is considering whether to approve Comcast's $45 billion purchase of its smaller rival. The deal would unite the two biggest cable operators in the country and give Comcast greater control over broadcast, cable television and high-speed Internet networks.
Comcast says the deal would not hurt consumers because the two companies do not compete in the same markets. But consumer groups say the merger would give Comcast too much power, stifling potential competition and eventually leading to higher prices.
Before approving mergers, regulators must decide whether the deals are in the public's benefit, and often extract promises from companies that they'll take steps to benefit consumers, like extending high-speed Internet service to underserved communities or promising not to favor their services over those of competitors.
But in a letter this week to FCC Chairman Tom Wheeler, Franken said Comcast has “a history of breaching its legal obligations to consumers," including pledges the company made to win regulatory approval for its 2011 merger with NBC Universal, the television and movie production company.
As one example, Franken cited Comcast's settlement with the FCC in 2012 after the company failed to aggressively market its $50-a-month standalone Internet service, a condition of the NBC Universal merger. The FCC imposed that condition to ensure the company did not force customers to buy bundled services if they only wanted high-speed Internet.
Franken also alleged Comcast violated net neutrality rules the company was required to follow as part of the NBC Universal deal. Net neutrality rules are meant to prevent Internet providers like Comcast from discriminating against certain Internet content, like charging to stream some online services faster than others.
In 2012, the consumer group Public Knowledge filed a petition with the FCC alleging Comcast violated those rules when the company introduced customer data caps and then said use of its online video service, Xfinity TV On Demand, would not count toward those caps.
The FCC has not ruled on the consumer group’s petition. In January, a federal appeals court overturned net neutrality rules.
Comcast later suspended data caps, but has resumed testing a tiered system that charges customers in some markets more for higher broadband use.
“Recent history, including Comcast’s adherence to the legal obligations it owes the public, should be taken into account when deciding whether to permit further consolidation in the cable and broadband networks,” Franken wrote.
In a statement, Comcast spokeswoman Sena Fitzmaurice said the company “is proud of our track-record on complying with the conditions from our past transactions including NBC Universal.”
“We’ve gone above and beyond in compliance with most conditions, including our low-income broadband program, the amount of local news programming and investment in local stations, the amount of on-demand programming, especially children’s programming, and many more areas,” Fitzmaurice said.
Indeed, Comcast has come through at times when it comes to its promises around major mergers. To win approval for the NBC Universal merger, Comcast pledged to offer broadband service for $10 a month and a laptop computer for less than $150 to eligible low-income families.
Last fall, Comcast Executive Vice President David L. Cohen announced the program, known as "Internet Essentials," had connected more than 1 million low-income Americans to broadband Internet in their homes.