Dish wades into Comcast/Time Warner deal...

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...And it does not look like this is gonna be an afternoon of cocktails and levity
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DISH Network Petitions FCC to Deny Comcast Time Warner Merger




ENGLEWOOD, Colo. --(BUSINESS WIRE)-- Citing irreparable harm to competition and consumers, DISH Network Corp. (NASDAQ: DISH) petitioned the Federal Communications Commission (FCC) to deny the merger of Comcast Corp. and Time Warner Cable, Inc. The petition to deny, available here, outlines, among other things, the critical role high-speed broadband plays in the video industry and the potential for the merger to significantly damage competitive development of over-the-top (OTT) video and limit consumer access to online video programming. Some key points from the petition on the following topics include:

MERGER PRESENTS RISK OF SIGNIFICANT HARMS:

p. 3

  • "Choke Points on the Comcast/TWC Broadband Network: The combined Comcast/TWC would be able to foreclose or degrade the online video offerings of competing MVPD and OTT video providers at any of three "choke points": (1) the points of interconnection to the combined company's broadband network, in effect the "on ramp" to the Comcast/TWC network; (2) the last mile "public Internet" portion of the pipe to the consumer's home; and (3) managed or specialized service channels, which can act as super HOV-lanes and squeeze the capacity of the "public Internet" portion of the Comcast/TWC broadband pipe.
  • Discriminatory Data Caps: The combined Comcast/TWC would be able to impose anti-competitive data caps on competing MVPD and OTT services. This could be done by exempting Comcast/TWC affiliated content from such data caps and then setting caps so low that consumers are incentivized to choose Comcast/TWC services over competing MVPD and OTT video services.
  • Programming Foreclosure: The combined Comcast/TWC would be able to foreclose access to, or raise the prices of, its own affiliated programming to harm competing MVPD and OTT services.
  • Restriction of Third-Party Online Rights: The combined Comcast/TWC would be able to coerce third-party content owners and programmers to withhold online rights from online video platforms, thereby stifling a crucial source of competition and innovation in the video industry."
p. 26

"The rapid rise of broadband-powered online video services has been great for consumers. In many ways, we are in the Golden Age of video. But this Golden Age risks being cut short by the proposed transaction."

p. 10-11

"Here, the public interest benefits the Applicants claim are unlikely and speculative. Further, the claimed benefits do not come close to outweighing the anti-competitive effects of the transaction, and the serious damage that will be inflicted on consumers if the merger is approved. The cost of "getting it wrong" is immense. If the Commission approves the merger under a set of conditions purportedly designed to alleviate the harms, and those conditions fail to work (which DISH strongly believes would be the case), competition and consumers would be irreparably and permanently harmed. The risks are simply too great here, and the only outcome that will serve the public interest is to deny the merger or designate it for hearing."

p. 66

"The Applicants want the Commission to believe that they will not act on their incentive and ability to shut out video competitors by leveraging their control over broadband connections in an anti-competitive fashion. But too much is at stake here to "trust" the Applicants' claims of benevolence. In this regard, past is prologue. As Comcast's history shows, it has had no apparent qualms about engaging in anti-competitive conduct when the opportunity has arisen. There is little doubt that Comcast will do so again when foreclosure is even more profitable than today, and when its ability to engage in successful foreclosure is dramatically enlarged."

OVER-THE-TOP VIDEO:

p. 28-29

"In DISH's experience, large amounts of throughput are required to provide a typical household with HD video through the Internet. An HD video stream requires on average 5 Mbps of data throughput; a typical household could require 15 Mbps (5 Mbps x 3 TVs) for HD video alone. When added to a typical household's other Internet and broadband usage habits, such as personal computers, Wi- Fi-enabled mobile devices, and "connected devices" (such as a home security system), another 5- 10 Mbps of throughput may be required to avoid degrading the television viewing experience. Thus, a typical household relying on the Internet to deliver all video therefore should optimally have no less than 25 Mbps in broadband connectivity. This means that 25 Mbps would be the minimum actual (as opposed to advertised) experienced speed provided to the residence in order to sustain, for example, a robust OTT video product capable of supplanting today's traditional linear pay-TV service."

p. 2

"High-speed broadband connections are the lifeblood of these new online services, and these connections will only become more important with each passing year. The services provided by DISH and other OTT video providers optimally require a household to have actual and consistent download speeds of at least 25 Megabits per second ("Mbps"). If approved, the combined Comcast/TWC would control 50 percent of the broadband pipes in the United States that have speeds of at least 25 Mbps. Most households will have no alternative to the combined company's high-speed broadband pipe. Some will have one alternative at best. As companies such as DISH innovate and invest to meet the growing consumer appetite for broadband-reliant video products and services, this chokehold over the broadband pipe would stifle future video competition and innovation, all to the detriment of consumers."

p. 39

"In sum, cable and fiber-based broadband are the only types of Internet access service capable of offering speeds of at least 25 Mbps consistently. Thus, if the merger is approved, the combined Comcast/TWC entity would not only pass almost two thirds of U.S. households, but would control 50 percent of the high-speed, high capacity U.S. residential broadband connections. Even at a more conservative threshold of 10 Mbps or faster as the relevant product market for broadband, Comcast/TWC would command more than 42 percent of the market. And, even at the abysmally low 3 Mbps cut-off proposed by Applicants, the merger would still result in the combined company controlling 35.5 percent of the market, which by itself would be sufficient to raise serious competitive concerns."

PROGRAMMING FORECLOSURE:

p. 4

"Comcast will have a greater incentive to foreclose rivals from its NBCU programming. And, even more concerning, this transaction would remove a key rationale for the Commission's approval of the NBCU acquisition. To defend that acquisition, Comcast argued that it would not foreclose its competitors from popular NBC programming because it would have to share the spoils with other operators—primarily with none other than TWC. The proposed merger would allow Comcast to pocket TWC's profits, too, and create the incentive that Comcast itself said it lacked without controlling TWC."

p. 83

"In particular, the combined Comcast/TWC—with its much greater scale than any other pay-TV provider—would also possess even more leverage than the two companies have now to: (a) acquire the most robust OTT distribution rights from third-party programmers in order to increase the appeal of its own video platform; and (b) restrict the ability of third-party programmers to grant online rights to competing OTT services, like DISH's."

p. 85

"The combined Comcast/TWC's leverage over programmers may squeeze their margins, as Comcast/TWC uses its control over access to almost one-third of the nation's MVPD households to push down the prices it pays for programming. This is a standard monopsony effect."

About DISH

DISH Network Corporation (NASDAQ: DISH), through its subsidiaries, provides approximately 14.053 million pay-TV subscribers, as of June 30, 2014 , with the highest quality programming and technology with the most choices at the best value. Subscribers enjoy a high definition line-up with more than 200 national HD channels, the most international channels, and award-winning HD and DVR technology. DISH Network Corporation is a Fortune 250 company. Visit www.dish.com.



CT


Photos/Multimedia Gallery Available: http://www.businesswire.com/multimedia/home/20140825006050/en/

DISH Network Corporation
Jenna McMullin , 303-723-1695
jenna.mcmullin@dish.com
@DISHNews

Source: DISH Network Corporation
 
Dish's biggest issue is they (Charlie admitted this in the last stockholders conference call)know pay tv is stagnated and dying market and on demand video is the future and its here now, the company lost 44,000 video customers last quarter.
To make video on demand work you need high speed internet and well satellite based internet isnt the answer, its terrestrial based internet.
 
Monopsony. Had to look that up. From Wikipedia:
The microeconomic theory of imperfect competition assumes the monopsonist can dictate terms to its suppliers, as the only purchaser of a good or service, much in the same manner that a monopolist is said to control the market for its buyers in a monopoly, in which only one seller faces many buyers
 
Multichannel has the following information...

The FCC has extended the comment deadline for input on the proposed Comcast/Time Warner Cable merger to at least Oct. 29 and stopped the informal shot clock on the deal, saying that Comcast's 850-page reply to its critics includes new information that will take longer to peruse and adding that Comcast's Sept. 11 reply to a follow-up data request was not complete and the materials remain outstanding.

Dish had sought an extension and Comcast and TWC had opposed it. -
"in order to permit commenters to submit well considered Replies to Responses and Oppositions," said the Bureau, " we grant the DISH Motion, and extend the deadline for filing until October 29, 2014. The Commission will make any necessary determination as to whether the Commission’s self-imposed 180-day shot clock for reviewing transactions should be stopped separately from this notice."

multichannel.com
 
I think this merger would be anti consumer.
What the FCC should be doing is figuring out ways to eliminate the current "local monopoly" system that now exists in telephone and cable tv.
Now, in some markets there is dual plant for cable. There is also dual plant for plain old telephone service( POTS)...For 99% of us though, there is just one local telco service and one local cable tv service.
Larger cable co's have been effective at keeping out competition.
Also, the FCC should take a long hard look at these mega mergers. The NBCU/Comcast merger is bad enough.
If things keep going the way they are, those who have cut the cord and others who watch their tv over the internet will find these mega providers choking down the internet to get back at those who refuse to "comply" and become part of the captive market Comcast, TWC, Charter, etc are seeking.
 
If things keep going the way they are, those who have cut the cord and others who watch their tv over the internet will find these mega providers choking down the internet to get back at those who refuse to "comply" and become part of the captive market Comcast, TWC, Charter, etc are seeking.[/QUOTE]

They do that already. I have no access to content streaming from the networks own sites through Charter because I don't sub to their TV service. I can pay Hulu for it, but I'm not allowed access myself directly.
 
If things keep going the way they are, those who have cut the cord and others who watch their tv over the internet will find these mega providers choking down the internet to get back at those who refuse to "comply" and become part of the captive market Comcast, TWC, Charter, etc are seeking.

They do that already. I have no access to content streaming from the networks own sites through Charter because I don't sub to their TV service. I can pay Hulu for it, but I'm not allowed access myself directly.[/QUOTE]
Let me clear up an issue. What I mean by "choking down" is when customers pay for certain upload/download speeds and the provider deliberately chokes down the speeds as a means to discourage Hulu, Roku, Netflix, etc users.
If the speed to which you are subscribed is not sufficient for on line video then it just isn't. If you are paying for say 5 up and 20 down and you are finding that frequently those speeds are not available, then yes, you have a legit beef. I'd be fuming.
Right now my ISP speed averages 1.5 up and 15 down. Video quality is fine. I subbed to MLB.tv. On some occasions, it will lock up. And I cannot watch the HD version. I'd have to go to the next step up which would be over $60 per month. IMO that is an absurd amount for internet.
 
If things keep going the way they are, those who have cut the cord and others who watch their tv over the internet will find these mega providers choking down the internet to get back at those who refuse to "comply" and become part of the captive market Comcast, TWC, Charter, etc are seeking.
Resistance is futile.
 
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