Lawmakers will call a wireless Internet provider and a budding golf network to testify on largest U.S. cable provider Comcast Corp.’s proposed $45.2 billion merger with No. 2 Time Warner Cable Inc. (TWC)
The choices for the hearing tomorrow at the Senate Judiciary Committee show lawmakers may want to ask whether a bigger Comcast could harm small competitors, said Bert Foer, president of the American Antitrust Institute.
Witnesses are to include James Bosworth, chief executive of Back9Network Inc., and Richard Sherwin, chief executive of New Haven, Connecticut-based wireless provider Spot On Networks, according to a list released today by the committee.
“It probably indicates concern about the vertical issues: Can the combined firm discriminate against content providers who need access to their tube?” Foer, whose group favors vigorous enforcement of antitrust laws, said in an interview.
Questions include whether Comcast, owner of the Golf Channel, could give favorable treatment to its affiliated networks, and whether it can charge different rates for online access to different companies that rely on the Web, Foer said.
Other witnesses before the committee led by Senator Patrick Leahy, a Vermont Democrat, are to include Comcast Executive Vice President David Cohen, Time Warner Cable Chief Financial Officer Arthur Minson Jr.; and Gene Kimmelman, a former Justice Department official who is president of the Washington-based policy group Public Knowledge. The group opposes the merger, saying it would give Comcast too much power over prices and distribution.
Incorporated in 2010, Back9Network calls itself a “lifestyle television network” about golf. Boswell in a March 2012 interview with Bloomberg Radio’s “The Hays Advantage” answered questions about negotiating carriage with cable providers.
“It is tough,” Bosworth said. “Look, when you own the game you tend to make the rules.”
The cable deal announced Feb. 13 needs clearance from the Justice Department, which considers whether the combination could harm competition, and the Federal Communications Commission, which assesses deals against a broader standard of whether they are in the public interest. Congress, which doesn’t vote on the deal, has influence over the regulatory agencies.
Cohen in a March 27 interview with the C-Span television news program “The Communicators” said he expects “a serious governmental review of the transaction.” The deal, he said, is “a lot less scary” than “some people would like to make it.”
Comcast doesn’t compete with Time Warner Cable, and will serve less than 30 percent of the pay-TV homes after the deal, Cohen said. He said Comcast will have “something less than 40 percent” of the wired market for high-speed Internet service, or broadband.
Members of the Judiciary Committee include Senator Al Franken, who in a Feb. 27 letter to FCC Chairman Tom Wheeler said the deal would “concentrate significant power in the hands of an already huge corporation.”
Franken, a Minnesota Democrat, questioned whether Comcast has followed commitments to treat Web traffic fairly, and to provide local news on stations owned and operated by its NBC and Telemundo networks.
Franken pointed out a 2012 settlement between Comcast and the FCC, which said it was concerned the company hadn’t complied with an obligation to offer reasonably priced broadband to customers who don’t take its cable service. Comcast paid $800,000 as part of a consent decree.
The FCC in September said Comcast must carry Bloomberg Television, a competitor to the cable company’s CNBC, near other news channels. The agency acted on a complaint by New York-based Bloomberg LP, parent of Bloomberg TV and Bloomberg News.
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