Comcast-Time Warner, In Summary

First, I have something of a followup to my sampling article from Wednesday.  De La Soul is giving away their entire catalog today (http://www.okayplayer.com/news/de-la-soul-give-away-entire-catalog-for-free.html).  I felt this was appropriate to mention given the sample heavy nature of De La Soul’s music.  As the linked article (along with this one: http://www.idolator.com/237302/de-la-souls-digital-availability-grounded-by-sample-clearance-delays) indicates, De La Soul’s music is difficult to find in MP3 form.  A lot of the original sample clearance contracts only applied to the original CD release, so any online release requires a new contract with the appropriate parties.  De La Soul’s move to give away their entire catalog (for 24 hours at least) is an inventive way to keep interest in their music alive.

The other big news of the hour is Comcast’s offer to purchase Time Warner Cable for $45.2 billion.  If this merger happens (and there’s absolutely no guarantee that it will), it would provide Comcast with an incredible presence in the market.  Comcast, according to Free Press, would control “would give Comcast control of more than a third of the US pay-TV market and more than half of the US triple-play market for video, voice, and Internet service” (http://www.freepress.net/blog/2014/02/13/comcast-time-warner-cable-disaster).  Comcast stated that they will divest themselves of three million subscribers to bring themselves under that 30 percent threshold.

There really isn’t too much to say that hasn’t already been said.  The deal has a lot of issues, from a competition standpoint in particular.  One of the major worries is that Comcast will have a significant amount of leverage with content providers when negotiating with content providers.  As anyone who remembers CBS’s dispute with Time Warner Cable (http://www.hollywoodreporter.com/news/time-warner-cable-loses-306000-652131) that resulted in blacking out CBS owned channels for many subscribers in New York City, cable companies and content companies periodically clash over fee agreements and pricing.  This issue becomes even stickier when taking into account that Comcast is a content company as well, through their ownership of NBCUniversal.  The merger thus potentially gives Comcast significant leverage over their competition, which raises significant antitrust concerns.  An interesting side note to that concern, though, is that Comcast offered to abide by the recently overturned Open Internet Order as a condition for the FCC approving Comcast’s purchase of NBC.

How the FCC and FTC rule on this merger should be particularly fascinating as it moves forward.  This acquisition invites a great deal of scrutiny and criticism.

For everyone still snowed in, enjoy any time off and stay safe.

 

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