Six months ago, Comcast announced plans to acquire Time Warner Cable. A number of organizations, including DISH Network, have expressed opposition to the proposed merger, and today Netflix announced that it filed a petition asking the FCC to deny Comcast’s request to take over Time Warner Cable.
The Netflix request, weighing in at a hefty 256 pages, states that a Comcast/TWC merger would cause “fundamental public interest harm.” In the summary, Netflix indicates that the proposed merger would seriously affect online video distributor’s (OVDs).
The combined entity would have the incentive and ability – through access fees charged at interconnection points and by other means – to harm Internet companies, such as online video distributor’s (“OVDs”), which Applicants (Comcast and Time Warner Cable) view as competitors.
It’s no secret that cable companies like Comcast, Time Warner Cable, and Verizon have serious issues with OVDs such as Netflix as online delivery of video content falls outside cable company business models. It’s no surprise given recent news of bandwidth throttling and attempts to force Netflix to pay for unthrottled access by cable companies that Netflix would be at the forefront of attempting to block a Comcast/TWC merger. Should the merger go through, it is very feasible that Netflix’s customer base would be negatively affected.
While at a glance it may appear to be a battle of business models, Netflix goes on to warn that a merger of two of the largest four cable providers in the United States threatens not only OVDs but the Internet itself.
The combined entity’s control over its interconnection arrangements, coupled with such an increase in size, would allow it to insert itself into the heart of all Internet commerce, disrupting innovation, reducing financing for edge providers, and foreclosing compelling services from ever reaching the light of day.
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