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In the current debate over how the U.S. should oversee the internet, the worst case scenario for many is the web reinvented as cable TV: a service where subscribers pay a lot of money for a limited number of channels, and in which the distributor chooses which shows can even appear on the platform.
Rivals of the telco giant [company]Comcast[/company] fear this is exactly what the company is trying cook up through acquiring its next largest competitor, [company]Time Warner Cable[/company]. The proposed merger is already unpopular with consumer groups, and now industry opponents are going into high gear to try a stop it.
On Monday, a consortium of smaller phone and broadband companies launched a campaign called “Don’t Comcast The Internet” to draw attention to a parade of potential horribles that could arise if regulators allow the merger.
At an event in Washington to kick off the campaign, the group presented antitrust authorities who predicted that a combined Comcast-TWC would stifle would-be competitors. One way it could allegedly do so is by using its market power to pressure content partners to keep their content — which is the lifeblood of both TV and broadband — away from new entrants.
The group also warned of danger to another part of the internet, predicting that younger internet and content companies would struggle to obtain permission from Comcast-TWC to appear before subscribers in the first place.
Nick Grossman of venture capital firm Union Square Ventures said he worried that start-ups could find themselves asking “Will Comcast greenlight it?” as a pre-condition to launching their business on the internet.
Others worried that the Comcast would exploit its set-top box to control the user experience and business ecosystem, much as Microsoft exploited its operating system monopoly in the 1990s.
It’s too soon of course to say if all — or any — of these dire predictions might come to pass. The FCC and the Justice Department still appear to be months away from finishing a review of the merger, a process that Comcast VP David Cohen had earlier predicted would be finished by the end of 2014.
In recent months, however, Comcast critics appear to have gained momentum as approval for the merger, which once seemed a near-sure thing, has come under growing doubt.
Comcast, meanwhile, appeared unfazed by the appearance of the coalition, offering the following statement:
“There’s no real news here — just another group of existing opponents making the same arguments they have already made at the FCC for months, many of which weren’t found to be credible in our past transaction reviews, and all of which we’ve refuted directly with evidence in the FCC record. The real facts remain the same: consumers don’t lose choice in the broadband or video markets. Consumers will see real benefits in faster broadband speeds and better video products, and a host of other benefits. And there are no transaction-specific harms to this merger.”
The “Don’t Comcast the Internet” crowd consists of industry umbrella groups Comptel, ITTA (The Independent Telephone & Telecommunications Alliance) and NTCA–The Rural Broadband Association. It’s not the first anti-Comcast posse to spring up of late: content providers like Netflix and Dish launched an initiative late last year called “Stop Mega Comcast” to point out the alleged downsides of the deal.
This story was updated on Tuesday at 12:30pm ET to include Comcast’s statement.