February 16th, 2014

Craig Aaron: “This deal would give Comcast too much power”

Today on CNN’s Reliable Sources hosted by Brian Stelter, CEO of the public interest group Free Press, Craig Aaron, spoke with Brian about the Comcast deal to merge with Time Warner Cable.

In the discussion, Aaron said to Stelter: “I think this deal, if it goes through, would give Comcast too much power… This would make Comcast a gatekeeper basically over all our forms of media and communication.”

A transcript of the discussion is available after the jump.

TRANSCRIPT:

BRIAN STELTER, CNN HOST:  My first e-mail was to Craig Aaron — he’s the CEO of the public interest group Free Press — because I knew he would be shocked and appalled by the news.

Sure enough, he was and his group came out against the deal that very night.

Craig joins me now from Washington to tell me why.

Craig, you wrote in a petition that’s now up on Free Press’ Web site, that putting this much power in the hands of one company is dangerous.  Why do you say that?

CRAIG AARON, FREE PRESS:  Well, I think shocked and appalled is absolutely right, Brian.  I think this deal, if it goes through, would give Comcast way too much power over what we watch, see, hear, read and download every day.  This would make Comcast a gatekeeper basically over all our forms of media and communication, giving them a lot of power to dictate the terms of the business, to decide what goes on the Internet and what doesn’t, certainly what goes on your cable system and what doesn’t.  And I think that’s too much power in the hands of one company that if this deal goes through would stretch to more — nearly two-thirds of American homes would be offered service by the new giant Comcast.

STELTER:  Let me play devil’s advocate with you.  If Comcast is so bad, why are 20 some million subscribers to it seemingly happy throughout the country?

AARON:  Well, I don’t know about happily because Comcast regularly ranks among the worst companies in surveys of customer service.

STELTER:  You’re saying they have nobody to switch to, I guess?

AARON:  I’m saying they’re the only game in town.  If you want high-speed Internet in most of the country, your only choice is the local cable company.  And for more and more Americans and maybe a lot more, that company is Comcast.

Now, that doesn’t mean that, you know, people want to give up the Internet or don’t want to be able to watch shows like this, they absolutely do, but it does mean that consumers don’t have a lot of freedom.  They don’t have a lot of choice.  If they’re unhappy with a company, they have nowhere else to turn.

STELTER:  You know, this big media war can feel small sometimes.  That’s what you’re getting at.  The channel that we’re on, CNN, is owned by Time Warner, which until 2009 also owned Time Warner Cable, which is now being bought by Comcast.

And, you know, full disclosure here, my fiancee, who I’m going to marry in a week, works at Time Warner Cable, she will be a Comcast employee, if this deal goes through.  It seems like these are companies so big and I wonder if they’re journalistic or other ethical questions you think this brings up when one company — in this case, Comcast — owns so many news channels, as well as entertainment channels.

AARON:  I think there’s real concerns for people with Comcast having this much control.  They do own and operate one of the biggest news operations there is, NBC.  And all of the NBC cable channels, as well as dozens and dozens of local television stations and there’s a lot of incentive for Comcast if they could get away with it to give a leg up for their own content and services.  That’s true on the news side, that’s true on the entertainment side.

STELTER:  Now Comcast, we asked them to come on this week, they declined.  But I know what they would say here, they would say we haven’t done any of that.  We have been responsible corporate citizens ever since the NBC merger three years ago.

Have you seen any evidence that contradicts that?

AARON:  Well, you know, I think content wise they’ve continued down the path.  One question will be are MSNBC and CNBC, are they going to cover this merger?  Are they going to cover it critically?

STELTER:  Well, you mentioned the Internet, maybe the most important part of this.  We’re talking about television a lot here.  But Comcast wants to charge more and more for faster and faster Internet.

Is that where the regulators in Washington should be paying the most attention when they scrutinize this deal?

AARON:  I think so.  I think at its core this deal is really about broadband Internet.  That’s the future.  That’s the market that Comcast is really trying to lock down with this deal.

It’s vastly profitable for them right now and they know if they can position themselves as the gatekeepers online, everything in the future has to go through them.  I think we have real concerns when really the only high-speed offering in many places is going to be that Comcast cable connection.

STELTER:  You say that, but I’ve noticed on my AT&T phone it’s getting better and better.  I can watch Netflix on my phone, it gobbles up a lot of data, a lot of bandwidth.  But I wonder if Comcast has to get more scale in order to compete with Verizon and AT&T, because in the future, those are going to be the big Internet providers.

AARON:  These are vastly profitable companies and I think you’re right.  I think they do see this as a play for more scale.  My concern is that what we’re doing is we’re essentially building a new cartel where the cable companies divide up their side of the market, it will be almost entirely Comcast with a few other people way down the list, they’re going to take your home Internet connections, your wire line service.

The phone companies are saying OK, we’re going to take the mobile market and we like it if there were fewer than four of us, we’ve tried that.  But the big two will be dominant and all of a sudden.

As a consumer, you just have very few choices and if they decide to start discriminating, if they decide to start blocking Web sites you don’t have anywhere else to turn, I think that’s the real danger here and the one thing in all the consumer benefits that Comcast has been touting about this merger, the one thing you never hear them say is that prices are going to go down.

They’re pretty clear that’s not the case.  Prices are going to keep going up and if they can do it they’re going to go up rapidly.  That’s why I think all consumers should be cautious and skeptical about what Comcast has proposed here.

STELTER:  It’s understandable to talk about consumers and what it means for them.  I think that’s a good point.  On that media conference call, I never heard anybody say prices are going to go down.

AARON:  So, I think Washington needs to take a close look at this.  Certainly, that’s what we’re going to be advocating for.  I’m sure Comcast will be spending money to push their position and they’re very close to both parties in Washington.

But this is certainly no slam dunk and I think the more the public speaks out, gets involved, says, wait a minute, I don’t like the cable guy very much, I really don’t think I’m going to like the cable guy on steroids.

STELTER:  Greg Aaron, thank you so much for being here and expressing your point of view on this.

AARON:  Thanks for having me, Brian.

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