Odds Favor Comcast/TWC Being Blocked, BTIG Says
It's “hard to imagine” Comcast's planned buy of Time Warner Cable getting regulatory approval in the current political climate, said BTIG in an email to investors Wednesday. Also that day, FCC Chairman Tom Wheeler revealed some details of the draft…
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net neutrality order set for a vote later this month (see 1502040055). Cable ISPs told us they worry about the effects a Title II Communications Act net neutrality regime will have on their broadband businesses (see 1502040054). “A populist groundswell in favor of net neutrality” has brought “a whole new level of scrutiny” to the deal that makes it unlikely regulators will consider it in a favorable light, BTIG said. “The odds are now in favor of the government formally opposing/blocking the Comcast Time Warner Cable transaction -- we put approval odds now at 30 percent, at best,” BTIG said. Predictions that the deal would be approved were partly based on widespread belief that regulators would look at competition in the broadband market at the local level, where the two cable companies don’t compete, the stock analysis firm said. The current political climate makes it more likely that the deal will be looked at in terms of competition on the national level, BTIG said. Comcast’s own filings say that in “63 percent of their footprint post-Time Warner Cable, they were the only consumer choice for 25 Mbps broadband (we suspect even higher now),” BTIG said. “How can the government approve Comcast and Time Warner Cable?” Comcast declined to comment.