Regulators could stall, unwind Comcast-Time Warner deal

A Wall Street Journal report said that the deal between Comcast Corp and Time Warner Cable's $45 billion deal will be eliciting debate between regulators from cable prices to neutrality in the next few months.

On late Wednesday, concerned groups have lined up to slam the proposed alliance, and WSJ said that US Congress members would most likely launch hearings to provide an arena were they could also weigh in on the merger.

Former Justice Department antitrust official Gene Kimmelman, who is now chief executive of the open media advocacy group Public Knowledge, said, "This transaction is dangerous for broadband competition and would likely inflate consumer prices. Antitrust officials and regulators need to scrutinize this deal carefully and prevent harm to consumers and the competitive process."

The New York Times said that it has entered into a definitive agreement to acquire Time Warner Cable in an all-stock transaction. The result will consolidate the top and the second-biggest cable television operators in the US, the NY Times said.

Perhaps to appease regulatory concerns, Comcast agreed to to undergo another lengthy review by the US government, which will most likely be conducted by the Justice Department and the Federal Communications Commission. WSJ said the antitrust division of the department will go over the proposed merger and check whether there are any violations in competition laws. Meanwhile, FCC currently has a broad mandate to review transactions happening in the telecommunications industry to ensure that the deals are in the interest of the public, the newspaper said. It is to note that both agencies cooperated on merger reviews in the past.

WSJ said the deal between Comcast and Time Warner came amidst the Justice Department's growing reputation of being a ruthless enforcer in regulations. Just last year, the department filed lawsuits to block some of the biggest merger deals in the airline and beer industries. The companies involved in the said mergers had to make various concessions before the Justice Department decided to settle, WSJ said. This January, the department won against a completed merger between two companies in the technology industry, and is vowing to seek actions to unwind the merger.

Tags

Comcast Corp, Time Warner Cable, US Justice Department, Federal Communications Commission

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