Thursday, February 13, 2014

Comcast Acquiring Time Warner

UPDATED: Comcast announced that it is acquiring Time-Warner Cable, Inc. for $45.2 billion. Back in the 1970s, the city of Indianapolis divided the county into two cable TV service areas: one covering the original Indianapolis city limits prior to Unigov; and a second covering the suburban areas outside the original corporate boundaries of the city. Comcast got the franchise for the suburban areas, while Time-Warner got the franchise for the old city limits. I mistakenly stated in an earlier post that both franchises would now have a common owner. Actually, Bright House acquired Time-Warner's Indianapolis franchise as part of a larger acquisition that occurred a number of years ago so they are separately-owned companies now. Sorry, it's hard to keep these companies' ownership straight. The acquisition does result in the combining of the two largest cable TV providers in the country.

In true corrupt Indianapolis fashion, the City-County Council required that the companies that bid for the franchise to serve the two monopoly service areas include a local ownership component. Another bow to the late great Beurt SerVaas, please. As a consequence, members of the downtown mafia made a killing when they were allowed to purchase minority interests in the two franchises of the two companies that were awarded cable TV franchises for a discounted purchase price and then were permitted to sell their interests shortly thereafter for about a 700% return on their investment, a form of insider trading at its worst.

Cable TV rates in the city of Indianapolis are outrageous and the service is poor, but the people who matter live very well at your expense. You also get socked with additional fees every time you pay your cable TV bill that go to the Capital Improvement Board to hand out subsidies to the billionaire sports team owners. Wouldn't you love it if we actually had a federal prosecutor in this town who sends corrupt public officials to prison where they belong like happens in almost every other major city in America? Think nothing of the potentially long prison sentence facing former New Orleans Mayor Ray Nagin after a jury found him guilty of accepting hundreds of thousands of dollars in bribes. Our elected officials do the same thing and worse all the time; it's just not prosecuted here.


Anonymous said...

Only one service provider? What about Brigthouse?

Flogger said...

Brian Roberts, chairman and CEO of Comcast: "The deal is pro-competitive, it's pro-consumer. We going to be able to bring better products, faster internet, more channels, on demand TV everywhere, on a national local platform that's really special," he claimed.

No mention of any reduction in cost to the consumer. The Cable Companies act as monopolies, but without the over sight that should govern their pricing. (Side bar - even if they were regulated more in Indiana what difference would that make.)

You have no choice or little choice in terms of content. As an example I cannot buy a certain group of channels I have to buy a Package.

I believe we used to have Cable Board in Indianapolis. Does it still exist??

Gary R. Welsh said...

I don't think it exists anymore, not like they ever did anything for the consumer when they did exist. I'll never forget watching one of their meetings on WCTY and looking on in amazement to see a lobbyist for one of the cable TV companies sitting there as a member of the board.