(Source: ReindeR Rustema/flickr)
In a controversial yet not entirely unexpected move, the Federal Communications Commission has approved the Charter Communications’ merger with Time Warner which — in the eyes of many consumers — looks much like the smashing together of one giant broadband provider with another. Indeed, that is essentially what it is, which ideologically goes against recent motions from the F.C.C. to promote competition within the cable industry instead of consolidating it. The agency has its reasoning, though.
The F.C.C.’s Chairman Tom Wheeler said:
If the conditions are approved by my colleagues, an additional two million customer locations will have access to a high-speed connection. At least one million of those connections will be in competition with another high-speed broadband provider in the market served, bringing innovation and new choices for consumers, and demonstrate the viability of one broadband provider overbuilding another.
The agency also said it has put into place a seven year deal that prevents Charter from implementing data caps or usage-based pricing. The company will also not be able to charge special fees to heavy traffic providers. Wheeler pointed out that Charter will have to extend its web connectivity while keeping costs reasonable.
Despite all these provisions, the approval of this merger is in direct contrast with some of the work the F.C.C. has conducted this year that directly aims to create competition within the cable space and lessen the power of the entrenched big guys. Read more here from Blouin News on how President Obama threw his weight behind the F.C.C.’s proposal to loosen the chokehold corporate cable giants have on the set-top box industry.
