Senate Democratic Leader Harry Reid Warns of Charter-Time Warner Cable Merger Risks

Time Warner Cable Charter Communications
Courtesy of Time Warner Cable Charter Communications

Senate Minority Leader Harry Reid (D-Nev.) is warning top regulators that the proposed merger of Charter with Time Warner Cable may lead to “higher prices and fewer choices for consumers,” although he stopped short of recommending that the transaction be blocked.

In a letter to Attorney General Loretta Lynch and FCC chairman Tom Wheeler, Reid wrote that the transaction “effectively creates a high-speed broadband duopoly,” with Comcast and Charter ending up as two broadband giants offering Internet service.

“While the companies involved in the Charter transaction may commit to mitigating anticompetitive outcomes, I ask that you closely review how effectively such commitments may be enforced,” Reid wrote. He went on to say that further consolidation in the broadband market “may pose a significant risk to consumers.”

Reid also expressed concerns over the merger’s impact on the market for online video, also called OVD.

Last month, Sen. Mike Lee (R-Utah) and Sen. Amy Klobuchar (D-Minn.) sent letters to the Department of Justice and the FCC, also raising concerns about the transaction. Lee is chairman is a Senate antitrust subcommittee, and Klobuchar is the ranking member. Five senators sent a letter last week with a similar warning, although they, like Reid, did not go so far as to say that the merger should be blocked.

The FCC and the Department of Justice are reviewing the proposed merger.

In a statement, Charter said, “For months we have worked with state and federal regulators to demonstrate New Charter’s plan to add tens of thousands of American jobs, expand broadband access to millions of underserved homes, preserve an open internet and offer fast unlimited broadband at a better value without additional modem fees. We are pleased that Netflix and other key stakeholders across the country have recognized that New Charter will be a ‘tremendous positive’ for the OVD industry and consumers.”

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  1. ned says:

    This will not be a good decision for the consumer. There is no way a company such as Charter can triple the debt they owe which will be 75 billion should this merger happen, hire thousands of people to bring offshore jobs back to the states that Time Warner has, sustain the cable plant with continuos upgrades / repairs to damaged plant, pay decent wages and benefits and not substantially raise cable rates to the consumer leaving the main cable providers being Charter or Comcast. Now how is all of that negative information good for the consumer………this deal needs to be rejected immediately..

  2. Jeremy Miles says:

    This merger happening could mean, job loss, not job gain. We have seen what happened when Comcast was merging with Time Warner, some members of Time Warner were “let go” and Comcast members moved in re-structuring the company. Remember, there are shareholders in each of these companies, someone will be getting paid and some full time employees will be let go that have families to support. It won’t be the 1,000 new part-time jobbers which will boost the bottom line for the shareholders, and by the way, they now don’t have to pay benefits, since it is part time! Win, win don’t you think?

  3. Mark Edelman says:

    What happened Harry. Did they forget to make a Payment to you.

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