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Comcast presents its case for Time Warner Cable takeover to the FCC

Comcast presents its case for Time Warner Cable takeover to the FCC

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Comcast and Time Warner Cable have taken a step towards the merger they announced in February. The companies have filed a request for review with the Federal Communications Commission, one of the agencies that will have to approve the $45 billion deal between America's two largest providers of wired broadband. In a 181-page document, the companies argued that Comcast's acquisition of TWC would give consumers network upgrades, better cable TV services, and expanded broadband access for low-income users. It's also seeking to allay fears that a merger would reduce competition in the already highly consolidated home broadband market.

Many of the promised benefits apparently stem from Comcast expanding its existing services to cover TWC customers. Its video service Xfinity On Demand will come to TWC markets, as will Comcast's subsidized "Internet Essentials" program for low-income Americans; the companies will pool their resources for Wi-Fi hotspots, with Comcast offering TWC subscribers access to its far bigger network. While a court eviscerated the FCC's net neutrality rules in February, Comcast is still required to abide by them until 2018 as part of a previous agreement, and the merger will require TWC to do the same.


But the biggest issue for regulators will likely be the size of the two companies and the generally uncompetitive wired broadband market: Comcast and TWC put together would have around 30 million TV and internet customers to their name, an order of magnitude larger than a company like Cablevision. Their gambit, essentially, is to ignore the entire broadband market and position themselves against all other internet-related companies. The chart above cites the market cap of Microsoft, Apple, Google, and Facebook, along with the largest wireless carriers: Verizon and AT&T. "The traditional boundaries between media, communications, and technology are obsolete," it says. It's even compared its service to the minuscule Google Fiber. This argument will have to convince both the FCC and the Department of Justice, which Comcast and TWC filed a notification with last week.

The company is holding a call later today to discuss the merger, and Comcast executive VP David Cohen will be testifying on Wednesday at a Senate Judiciary Committee hearing, which will examine the impact of the proposed merger on consumers.