Comcast Faces Off Against Congress Over TWC Merger (PC Magazine)

The Senate Judiciary Committee gave the pending TWC-Comcast deal a skeptical once-over during today's hearing

Will the pending merger of Time Warner Cable and Comcast provide consumers with better Internet and video options or stifle competition and give Comcast an edge when negotiating with the channels that appear on its lineup?

Those were just some of the questions fielded by TWC and Comcast executives who appeared on Capitol Hill today for a hearing on the $45.2 billion deal.

Comcast executive vice president David L. Cohen responded to queries from members of the Senate Judiciary Committee, many of whom - on both sides of the aisle - questioned why the deal was necessary and whether or not it would lead to price hikes and adversely impact smaller, independent programmers.

Cohen reiterated the points he made during a Tuesday conference call with reporters, including the assertion that a combined TWC/Comcast will provide faster Internet speeds, better network reliability and security, better in-home Wi-Fi, and greater on-demand options, among other things.

When asked by Sen. Amy Klobuchar if these benefits would happen without the merger, Cohen said they will "happen faster" if the deal goes through. "The reason those benefits have not occurred on Time Warner Cable is the difference in scale, and it's the scale that leads to the investment and rapid deployment of those benefits."

Comcast has argued that in the digital era, it is now competing with the likes of Google, Amazon, Hulu, Netflix, and other Web-based video content providers. The Internet services provided by Comcast and TWC have helped these companies thrive and in some cases surpass Comcast, Cohen said, so the TWC deal helps the firm compete.

But when James L. Bosworth, Jr., chairman and CEO of Connecticut-based golf channel Back9Network, was asked if securing content deals with Apple or Amazon was the same as securing a deal with Comcast, Bosworth said "it's an increasing marketplace but yet still, the average American watches 20 times more video via TV than they do online." Advertising dollars are king, and that money flows more readily via cable TV, Bosworth said.

Among the more skeptical members was Sen. Al Franken, a Minnesota Democrat, who said flatly that he opposed the deal. Ultimately, his concern is that the merger will lead to increased prices for consumers, and let Comcast exercise its newfound leverage to "squeeze consumers."

When news of the merger made the rounds, reaction from consumers was largely that one cable company with an awful reputation was simply merging with another, creating one big customer service nightmare. Cohen addressed this during today's hearing, arguing that "it's not something we're ignoring."

Comcast has "spent billions" working to improve the customer service experience, as well as network reliability. Yesterday, he told reporters that "we try to take those low scores and those evaluations as the kick in the rear end that we need to do more and improve the overall quality."

"We think we are making progress," he continued, but "are we where we want to be? Absolutely not."

Comcast has submitted the necessary paperwork to the FCC and the Justice Department, who need to sign off on the deal before it becomes official. Congress will no doubt have more to say, too, so stay tuned.