http://www.forbes.com/sites/dorothypomerantz/2014/04/08/comcast-argues-merger-with-time-warner-cable-will-be-good-for-consumers/
Comcast and Time Warner Cable will be defending their request to merge by saying that it will actually benefit consumers. Comcast claims that as there become more and more cable options available to consumers, its company is not big enough to compete with others such as Apple, Netflix, and Google Fiber. Another argument is that the merger will not really affect consumers because the two companies operate in different areas and do not compete with each other. Therefore, the "competitive landscape" will stay the same. However, many public interest groups are opposing the merger because they say the two companies could raise prices which will actually harm consumers. It will be interesting to see if the senate judiciary committee actually allows the two companies to merge and how it will actually affect consumers and prices.
Comcast and Time Warner Cable will be defending their request to merge by saying that it will actually benefit consumers. Comcast claims that as there become more and more cable options available to consumers, its company is not big enough to compete with others such as Apple, Netflix, and Google Fiber. Another argument is that the merger will not really affect consumers because the two companies operate in different areas and do not compete with each other. Therefore, the "competitive landscape" will stay the same. However, many public interest groups are opposing the merger because they say the two companies could raise prices which will actually harm consumers. It will be interesting to see if the senate judiciary committee actually allows the two companies to merge and how it will actually affect consumers and prices.
2 comments:
My immediate reaction is to oppose the merger between these two companies. Though they may not be direct competitors, I think they do attract similar consumers and a common region. However, after further thought, this article and their claims do make good points. Netflix, apple, and google are definite competitors and would also give these firms a run for their money. If the committee does approve the merger, I think it will be interesting to see how the market reacts and if any other entertainment industry related firms seek appeal and potential mergers.
I think the merger can create a monopoly in the cable market, and can be a huge threat to users as they will probably pay substantial higher fees. If the two companies are doing fine on their own, why do they have to merge? Unless Comcast and Time Warner Cable can show that the consumers can clearly benefit from the merger while it provides no harm to other players in the market, there is no reason to approve this merger.
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