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

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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