September 9, 2014

FCC Chairman Wheeler calls for broadband competition in light of Comcast-Time Warner merger proposal.

On Thursday, Sept. 4, Federal Communications Commission (FCC) Chairman Tom Wheeler delivered a speech entitled, "The Facts and Future of Broadband Competition," in which he expressed concerns about the limited nature of Americans' current high-speed (25 Mbps and up) internet options.

"The underpinning of broadband policy today," Wheeler asserted, "is that competition is the most effective tool for driving innovation, investment, and consumer and economic benefits. Unfortunately, the reality we face today is that as bandwidth increases, competitive choice decreases."

To remedy this lack of competition, Wheeler suggested that an agenda for broadband competition be implemented to provide a roadmap for public policy regarding high-speed internet access. Though Wheeler's speech did not mention any service providers by name, Executive Vice President of Comcast David L. Cohen issued a statement in response to Wheeler's call to action, in light of Comcast's proposed $45 billion acquisition of Time Warner in Feb. 2014—a consolidation of "the nation's two biggest cable operators" according to The Wall Street Journal.

"Broadband is not a static market, capable of analysis at a single point in time," Cohen asserted in his Sept. 5 response. "[Mobile] technology is a viable substitute for many uses of the Internet today and will indisputably provide even more competition in the future."

Comcast is no stranger to business acquisitions, nor is it unaccustomed to being under the scrutiny of the FCC's watchful eye, having acquired NBCUniversal in a similarly controversial deal in Feb. 2013. The merger has also been under fire by Netflix, whose business model relies on what the FCC calls the "Open Internet." Responses to Comcast's defense of the merger are due Oct. 8, Variety reports. The FCC and the Department of Justice will either reject or approve the merger by early 2015.