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With next week’s deadline approaching for comments to be filed with the FCC on Comcast’s proposed acquisition of Time Warner Cable, Comcast’s executive VP and chief lobbyist David Cohen delivered the keynote address this week at the Technology Policy Institute’s Aspen Forum, in which he offered a very succinct and lawyerly case for why the merger should be approved by federal regulators.
I won’t dwell on how there are no horizontal antitrust concerns here – because there’s not much more to say. The two companies
simply do not compete for customers in any market…
I also won’t belabor our response to the outlandish and factually unsupported claims about our supposed post-transaction share of broadband connections across the country. Of course, there is no relevant “national” broadband “market” to begin with, since broadband competition among ISPs is highly local in nature. After all, what does it matter if Comcast is going to control the broadband market in Philadelphia and Los Angeles because no one in Philadelphia can buy broadband in Los Angeles; and no one in Los Angeles can buy broadband in Philadelphia. And, most importantly, assertions that our share, post-transaction, will be upwards of 50 percent simply ignore the actual evidence – our post-transaction share of wired broadband connections is 35.5 percent, based on the FCC’s most recent data – and ignore the marketplace developments happening every day, including the dizzying growth of 4G/LTE wireless connections, which if included would reduce our post-transaction share to a little over 15
He then goes on to knock down the argument that the merger should be blocked because bigger companies are always bad.
To be sure, big is sometimes bad. After the financial crisis and the debates around “too big to fail” financial institutions, skepticism
is understandable. But, I think we have to look at each case separately, based on facts and analysis, and above all, anchored by
The primary business rationale underlying our merger with Time Warner Cable is because it will provide us the increased scale to invest and innovate more in both residential and business services. Here the scale efficiencies are key because we are in a sector where most of our costs are fixed, or at least do not grow proportionally to the increase in scale. This leads to more investments meeting the hurdle rate and being profitably undertaken, which in turn will lead to more innovations being generated. This is precisely how the long-run consumer welfare effects that Shelanski and Katz wrote about emerge, and I don’t know that there is a transaction out there that makes this case as compelling as the merger between Comcast and Time Warner Cable.
One topic Cohen carefully avoided mentioning, however, was Comcast’s well-earned reputation (and TWC’s for that matter) for appalling customer service — a topic that’s been much in the news since Ryan Block’s recording of his nearly surreal conversation with a Comcast rep when he called to disconnect his service went viral.
Since then, many similar stories and recordings have emerged, while the Verge has been doing yeoman’s work collecting anecdotes from former Comcast employees revealing the many ways in which Comcast’s internal policies and procedures for handling customer service calls could not possibly be more misbegotten.
I, too, could feel Block’s pain. Several years ago, while employed full time as a journalist, the company I was working for decided to stop renting office space for the small bureau I shared with four colleagues and make all of us work from home. We were provided with office equipment and supplies and the company paid for phone and internet service.
My choices for internet came down to Verizon DSL or Comcast’s broadband service. I was already a Comcast cable and broadband subscriber at home so my first thought was to just bundle in digital voice and send the whole bill to the company. But the company would not pay for my personal cable TV or phone service and it wanted a clean bill for my business phone and internet. It also did not want a direct billing relationship with the service provider. The result was that I ended up with two separate Comcast accounts, one from Comcast Business for internet and digital voice, and one from Comcast Cable for video. I paid both and submitted the Comcast Business bill to my company each month for reimbursement.
Some time later, the inevitable happened, and the company decided to eliminate my job altogether and I was laid off. I soon began contributing to GigaOM and other outlets and eventually set up my own business, Concurrent Media Strategies. At the time, I still had two accounts with Comcast, only I was no longer being reimbursed by an employer for either. Since I no longer needed to keep the various services separate I realized it would be easier and cheaper to simply buy a single triple-play package.
That’s when the fun began. I called Comcast to say I wanted to roll my two accounts into a single triple-play but I didn’t particularly care whether it was with Comcast Business or Comcast Cable. I was told that Comcast Business could not sell me the level of cable service I had (purportedly due to some regulatory restriction but I didn’t pursue it) so I decided to put everything on my cable bill and cancel the Comcast Business account.
Alas, the digital voice number I had been using and wanted to keep apparently “belonged” to Comcast Business and could not be transferred to my Comcast Cable account. If I wanted to keep the number I had to maintain a Comcast Business account. But then I would be unable to purchase the tier of cable TV I wanted. I suggested that seemed rather dumb, since the tier I wanted was more expensive than the tier they were willing to sell me but to no avail. Several reps I spoke with even agreed it was crazy but they were unable to resolve the dilemma.
I was passed on to a supervisor. Then to another supervisor, and another and another. We went round and round for weeks. Weeks turned into months, during which I was still being sent two bills, while I vainly sought someone with enough authority to sell me what I was pleading to buy.
In the midst of all this I met a very senior Comcast exec at an industry function. Trying to keep things professional I did not unload on him, but I did mention that I was a Comcast subscriber. He rather sheepishly asked if I was a satisfied Comcast subscriber, as if he knew what might be coming.
Since he asked, I told him my tale. He was very pleasant about it, gave me his email address and asked me send him my story in an email. When I said it seemed like perhaps this was not the first time he had faced a customer complaint and a social function he said that even the most senior executives at Comcast are told to expect to spend roughly 15 percent of their time handling what were essentially customer service problems — which is pretty remarkable.
As it turned out, even my high-level contact (he reported to David Cohen) apparently lacked the juice to get the various silos to talk to each other. He helpfully copied me on emails he sent to various department heads asking them to try to resolve my problem (I was after all a reporter covering technology companies and there was a risk of bad PR) but to no avail.
Months later, I finally connected with a rep who came up with a creative solution. We would cancel both of my accounts and my phone number would be “released” by Comcast Business, freeing it up to be assigned randomly to any account. At the same time, would create a new personal account with triple-play service and grab my number before it could be assigned to someone else. That way, no “transfer” of the number occurred between Comcast Business and Comcast Cable and everyone was happy.
The whole thing took the better part of six months, during which I was essentially being over-billed. I thought about demanding a refund but I no longer had the heart for the fight. Today, I am still a Comcast triple-play subscriber because I really have no other practical choice, and I still dread every time I have to deal with their customer service department.
Over on the Wet Machine blog, Public Knowledge senior VP Harold Feld does a heroic job trying to make the case that Comcast’s well-documented history of customer abuse provides sufficient legal grounds for the FCC to reject its merger with Time Warner Cable outright. I won’t try to argue the law with Feld but it seems like a long shot.
And in any case, I still won’t have any other practical option but to keep paying Comcast.