Adelphia Sale Opposed by Hispanic Group, Praised by Others
The $17.6 billion sale of most Adelphia cable systems to 2 rivals (1) bodes well for minorities because of increased investments, or (2) hurts minorities because of potential discrimination, depending on which group you listen to. The National Hispanic Media Coalition (NHMC) said the Commission should block the deal or impose significant conditions, but several African-American groups back it. Public comments on the deal were due late Thurs. Earlier this year, Time Warner and Comcast agreed to buy most of the bankrupt firm’s cable systems to enlarge their super-clusters of customers (CD April 22 p2), saying it would benefit all consumers.
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As with most major telecom transactions, media activists oppose the deal, saying it will give 2 large cable operators even more dominance in certain markets, such as L.A. for Time Warner and Comcast in Washington, D.C. And, also as expected (CD June 13 p3), communities and telecom providers petitioned to deny the transaction. These include DirecTV and 5 Fla. counties, FCC filings show (05-192). DirecTV warned of “regional monopolies” where anticompetitive behavior is likely, asking the FCC to impose conditions barring exclusive carriage accords between regional sports networks affiliated with Comcast and Time Warner and those cable operators. EchoStar also wants conditions on the merger, it said in a separate FCC filing.
Comcast drew the most criticism. Fla.’s Marco Island Cable said Comcast has tried to curb that company’s expansion. The Communications Workers of America (CWA) and International Brotherhood of Electrical Workers said the deal “represents a significant barrier to competitive entry.” The CWA also notes “Comcast’s record of poor relations with employees and its continuing policy of preventing workers from making a fair choice about union representation,” a union spokeswoman said.
Groups representing minorities squared off over the deal. The NHMC wants conditions to protect Hispanic- Americans via “benchmarks” for delivering new services to minority communities, providing English-language programs targeted at minority groups and boosting employment of minorities in “decision-making positions.” It said: “Comcast has been particularly insensitive to the needs of Hispanic Americans. Unlike other major cable MSOs, Comcast has been unwilling to provide significant amounts of English-language programming directed at the needs of Hispanic Americans.” Si-TV is carried by Time Warner in almost all areas, while Comcast provides it in a “handful” of systems, the NHMC said. Comcast declined to comment.
Two groups representing African-Americans disagreed with NHMC, citing a potential for upgrades of Adelphia systems that had lagged behind rivals. The Black Leadership Forum, whose member groups represent nearly 15 million African-Americans, said the deal “will be a much needed shot in the arm for our economy while at the same time significantly improving the delivery and quality” of cable products. The National Black Chamber of Commerce, whose members include more than 100,000 firms, made similar comments.
In a May 18 filing seeking FCC approval, the firms said: “The transactions will accelerate the deployment of advanced services,” and “promote competition.” The 2 largest U.S. cable providers said Adelphia customers will get “accelerated deployment of video, high speed data, voice” and other products. In a statement to us on Fri., Comcast largely repeated that, saying: “We look forward to completing regulatory reviews in a timely fashion.”
Time Warner Cable plans to submit responses to public comments by the Aug. 5 deadline, a spokesman said. The firm said Fri. “these transactions will benefit consumers. As the government review process unfolds, we are confident these benefits will become very clear.” The FCC is unlikely to impose conditions in approving the merger, said attorney Michael Hazzard: “De facto U.S. policy has become vertical integration… I think we're starting to see it pick up momentum and speed.”