Comcast abandons Time Warner Cable bid after gov’t pushback

World Today

FILE - Wall Street appears increasingly convinced Comcast’s $45.2 billion purchase of Time Warner Cable is dead. (AP Photo/Gene J. Puskar, File) FILE – Wall Street appears increasingly convinced Comcast’s $45.2 billion purchase of Time Warner Cable is dead. (AP Photo/Gene J. Puskar, File)

What killed Comcast’s $45 billion bid for Time Warner Cable? Regulators’ desire to protect the Internet video industry that is reshaping TV.

A combination of the No. 1 and No. 2 U.S. cable companies would have put nearly 30 percent of TV and about 55 percent of broadband subscribers under one roof, along with NBCUniversal, giving the resulting behemoth unprecedented power over what Americans watch and download.

Competitors, consumer groups, and politicians have criticized the deal, saying it would lead to higher prices and less choice.

“The proposed merger would have posed an unacceptable risk to competition and innovation, including to the ability of online video providers to reach and serve consumers,” Federal Communications Commission Chairman Tom Wheeler said in a written statement.

The Justice Department said that Comcast dropped its bid because of regulators’ concerns that the Philadelphia-based cable giant would become an “unavoidable gatekeeper” for Internet services.

One of the concerns consumer advocates and competitors had with the Comcast deal was that it could undermine the streaming video industry that is reshaping TV. Comcast could, for example, require onerous payments from new online-only video providers for connecting to its network. Dish, the satellite TV company behind the new Web video service Sling TV, and Netflix opposed the deal.

Report by The Associated Press