www.CableAdvisoryCouncil.com

For Charter Communications NW CT Area 19

PO BOX 87, Newtown CT 06470

Email Chairman@CableAdvisoryCouncil.com

 

CABLE ADVISORY COUNCIL CHAIRMAN REPORT

Gregory G. Davis

 

 

Quote of the Day  27 August 2014

"Absent either denial of the transaction or imposition of conditions, the communications ecosystem could forever and dramatically change to the detriment of consumers and competition alike."

– Sinclair Broadcasting’s comments, filed with the FCC, on the Comcast/Time Warner Cable merger

 

26 August 2014

“It is important to remember that for every programmer that wants more money for carriage or expanded carriage, this imposes real costs on consumers and limits the opportunities for other cable networks to gain access to our systems. Our programming costs have increased by over 130% over the past 10 years while our consumer pricing has increased at about half that rate. We’ve had success in negotiating programming deals in the marketplace and believe that’s the right place for buyers and sellers to make deals without government intervention.”

– David Cohen, executive vice president, Comcast

 

Comcast Predicts Time Warner Cable Deal Completion in Early 2015

By Robert Valpuesta Aug 26, 2014 7:08 AM ET

Comcast Corp. (CMCSA) said it now expects its planned $45.2 billion acquisition of Time Warner Cable Inc. to be completed early next year.  ….

….The deal would bring largest U.S. cable provider Comcast an additional 7 million customers, for a total of 29 million residential video subscribers, and a presence in the top two U.S. media markets, New York and Los Angeles.

 

 

 

 

Dish Warns of Irreparable Harm from Comcast/Time Warner Merger

Satellite television provider Dish filed a petition with the FCC yesterday to block the Comcast/Time Warner Cable merger, warning of "irreparable harm" to the industry and consumers.
Why This Matters: Among the potential harms that Dish identified in the merger are "discriminatory data caps," and "restriction of third-party online rights.” Dish claims the merger could significantly damage development of over-the-top (OTT) video and limit consumer access to online video programming.
4 Takes: CNBC | ZDNet | Home Media | Advanced Television

 

ADVANCED TELEVISION:

DISH warns of Comcast/TWC merger ‘harms’

Citing irreparable harm to competition and consumers, DISH Network has petitioned the Federal Communications Commission (FCC) to deny the merger of Comcast Corp. and Time Warner Cable. The petition to deny 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 DISH Network petition to the FCC:

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.”

 

 

DISH warns of Comcast/TWC merger ‘harms’ continued:

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.”

 

 

 

 

 

COMCAST MERGER PRESENTS RISK OF SIGNIFICANT HARMS continued:

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.”

Netflix Slams “Disrupting” Comcast-Time Warner Cable Merger To FCC

by Dominic Patten

·        August 26, 2014 10:29am

They may have come up empty-handed at last night’s 66th Primetime Emmy Awards, but Netflix was thinking about the future on Monday. The future of broadband and Internet access that is. In a blistering petition to the FCC, the streaming service recommended that the proposed mega-merger between Comcast and Time Warner Cable be denied. “The combined entity’s control over its interconnection arrangements, coupled with such an increase in size, would allow it to insert itself into the heart of all Internet commerce, disrupting innovation, reducing financing for edge providers, and foreclosing compelling services from ever reaching the light of day,” said Netflix in a filing submitted yesterday (read it here). The melding of the nation’s biggest and second-biggest providers of on-ramp access to the Internet “presents serious public interest harms stemming from the combined entity’s increased ability and incentive to harm providers of Internet content.”

Similar to past critiques of the merger from Netflix over who would control the pipes if the two were to become one and who could be discriminated against in the process, the dense redacted petition notes that “Comcast recently has shown that it is willing to go to great lengths to do so by manipulating Internet traffic at the interconnection points with its network to harm Netflix.” A weighty player in this debate, Netflix has been estimated to make up nearly 30% of all Internet traffic during peak hours. To that end, in late February, Netflix inked a deal with Comcast to ensure stable and fast broadband access. This came after its delivery speed on the provider appeared to be significantly slowing down, causing frequent delays and pauses for customer watching TV series and pics on its service. The seemingly very un-net neutrality agreement came just after the announcement of Comcast’s $45.2 billion purchase of TWC earlier this year.

“Unsurprisingly, given their dominance in the cable television marketplace, the proposed merger would give Applicants the ability to turn a consumer’s Internet experience into something that more closely resembles cable television,” Netflix’s petition adds. “It would set up an ecosystem that calls into question what we to date have taken for granted: that a consumer who pays for connectivity to the Internet will be able to get the content she requests.”

Netflix’s petition for denial came just hours before the midnight deadline for the first round of comments on proposed multi-billion dollar merger. The next benchmarks are September 23, where comments in reply to the first round will have to come in and then October 8 for the last round of remarks on the matter. While Comcast hasn’t respond directly to Netflix’s petition, the company did do so indirectly in comments made in a statement over the support the merger has received before the FCC deadline. “We continue to be struck by the number of comments that raise industry-wide rather than transaction-specific issues, as well as the commenters who are seeking to use the transaction-review process to seek government support for parochial business interests that they could not otherwise achieve through other regulatory proceedings or in the competitive marketplace,” Comcast said today.

 

Netflix Signs Interconnection Agreement with Time Warner Cable

Netflix and Time Warner Cable confirmed that they have struck a paid interconnection deal, an agreement that follows similar, recent pacts that Netflix has reached with Comcast, Verizon Communications and, most recently, AT&T.
Why This Matters: While Netflix has reluctantly signed such agreements, the company has also complained to the FCC about it, calling them an “arbitrary tax” and urging the Commission to include paid peering and interconnection deals in the discussion as the Commission pursues new network neutrality rules.
5 Takes: Gigaom | Ars Technica | Variety | MCN | Fierce Online Video

 

How to Save the Net: Don’t Give In to Big ISPs

By REED HASTINGS   08.19.14  6:30 am  Published in Wired Magazine September 2014 Issue

The next Netflix won’t stand a chance if the largest Internet service providers in the US are allowed to merge.

The Internet has already changed how we live and work, and we're only just getting started. Who'd have thought even five years ago that people would be streaming Ultra HD 4K video over their home Internet connections?

Technological advances are driving this evolution and will continue to do so only if we make sure the companies controlling consumers' access to the Internet don't adopt business practices that stifle its revolutionary nature. The next Netflix won't stand a chance if the largest US Internet service providers are allowed to merge or demand extra fees from content companies trying to reach their subscribers.

This year we reluctantly agreed to pay AT&T, Comcast, and Verizon for access to our mutual subscribers, who were seeing a rapid decline in their Netflix viewing experience because of congestion at the connection point where we transfer content to the ISP. The ISPs argue that our data-rich services take up limited capacity on their networks. But broadband is not a finite resource. Network limitations are largely the result of business decisions to not keep pace with subscriber demand in a world where the Internet increasingly is the main vehicle for all kinds of entertainment, from gaming to movies to video chats with loved ones.

It would be better to have no rules than the ones being proposed by the FCC, which simply legalize discrimination on the Internet.

Consider this: A single fiber-optic strand the diameter of a human hair can carry 101.7 terabits of data per second, enough to support nearly every Netflix subscriber watching content in HD at the same time. And while technology has improved and capacity has increased, costs have continued to decline. A few more shelves of equipment might be needed in the buildings that house interconnection points, but broadband itself is as limitless as its uses.

We'll never realize broadband's potential if large ISPs erect a pay-to-play system that charges both the sender and receiver for the same content. That's why we at Netflix are so vocal about the need for strong net neutrality, which for us means ISPs should enable equal access to content without favoring, impeding, or charging particular content providers. Those practices would stunt innovation and competition and hold back the broader development of the Internet and the economic benefits it brings.

Customers pay companies like AT&T, Comcast, and Verizon a monthly fee, and some are even financially penalized if they exceed usage caps. Charging us a separate fee ultimately means consumers pay twice—first for their broadband connection and second through higher-cost or lower-quality Internet services.

It's worth noting that Netflix connects directly with hundreds of ISPs globally, and 99 percent of those agreements don't involve access fees. It is only a handful of the largest U.S. ISPs, which control the majority of consumer connections, demanding this toll. Why would more profitable, larger companies charge for connections and capacity that smaller companies provide for free? Because they can.

This is the reason we have opposed Comcast's proposed acquisition of Time Warner Cable. Comcast has already shown the ability to use its market position to require access fees, as evidenced by the Netflix congestion that cleared up as soon as we reached an agreement with them. A combined company that controls over half of US residential Internet connections would have even greater incentive to wield this power.

The Federal Communications Commission has historically focused only on last-mile connections—the final leg of the Internet that connects individual homes to the World Wide Web. Today's problem spots are further upstream, at the choke point where companies like Netflix pass our traffic off to the ISPs. If the FCC doesn't expand its purview to include these transactions, it would be better to have no rules than the ones being proposed—which simply legalize discrimination on the Internet.

Reed Hastings is the CEO of Netflix.

 

Sound & Vision Magazine – October 2014 Issue  News Clips:

 Report by Mark Fleischmann  p.19

  Binge Viewing:  is the drug of choice in 94 percent of U.S. households….

  Pay TV Revenue Growth has peaked in North America…. With revenues forecast to fall by 9.2% between 2013-2020..

  Streaming Subscribers total nearly half of the U.S. population ….

  Cord Cutters are Satisfied: …. And 37% are so happy they will never go back.  US Cable companies will lose nearly $7B in revenue if they do not improve customer service….

 

Cable TV Bills Outpace Inflation And Cablevision Is Nation's Highest

By Michael LearmonthHYPERLINK "http://www.twitter.com/learmonth"@learmonthHYPERLINK "mailto:m.learmonth@ibtimes.com"m.learmonth@ibtimes.com
on August 18 2014 3:52 PM

When it comes to the cable bill, how high is too high? How about $152.72 a month, the average bill for customers of Cablevision (NASDAQ:CVC), the company that owns cable systems in and around New York City and Long Island, along with News 12 Networks and Newsday Media Group? ….