Last month Comcast announced its plan to buy rival cable company Time Warner Cable. In addition to being the two largest cable companies in the country, Comcast and TWC are also the biggest broadband providers.
While Comcast says that the merger will not have a negative impact on competition, citing improved internet speeds that will lead to lower prices, customers fear that it will give the companies too much control over internet and cable television.
The Department of Justice officially began its antitrust probe last Thursday. In addition to issues related to Comcast’s potential domination of the market, the DOJ is also concerned that Comcast owns NBC Universal.
The DOJ announced last Thursday that William Baer, a senior justice official, was no longer to be involved in the review of the merger because he represented General Electric (it owned NBC) during Comcast’s acquisition of a majority share in the company.
It is difficult to predict whether or not the DOJ and FCC (who is also looking into the proposed acquisition) will allow the Comcast/TWC merger. While the Obama Administration allowed the US Airways/American Airlines merger with little hesitation, the FCC prohibited AT&T from purchasing T-Mobile back in 2011 after determining that the merger would decrease competition and investment in wireless communications.
We will provide updates to the ongoing antitrust probe on this blog. To learn more about our firm and the services we offer visit our website or contact us.