Charter-Time Warner merger would drive out OTT providers claim opponents

The $65 billion merger between Charter Communications, Bright House Networks and Time Warner Cable would create a giant whose dominance would put other service providers out of business, opponents of the deal have told US regulators. Threatened rivals have called on regulators to impose a blockage on the same grounds used to prevent a Time Warner-Comcast merger earlier this year.

With Charter controlling broadband the independent video providers would struggle to get their services running ‘over-the-top, according to said Jeff Blum, senior VP at Dish, which filed a petition against the merger.

“Charter and Time Warner want people buying bundles of broadband and video, so the development and growth of over-the-top is something that competes with them,” said Blum, who argued that the new merged behemoth would have ‘an incentive to sabotage’ and the means to do it.

Public interest groups are also against the deal. Advocacy group Public Knowledge filed a petition to deny the merger, along with the Consumers Union, Common Cause and Open MIC.

“The motivation is clear: monopoly power,” wrote Free Press in its filing. “Consolidation would enhance each distributor’s market power to stifle competition from online video distributors.”

The opposite is true, claimed Alex Dudley, Charter’s Communications VP. “Over the top video providers have no better friend than Charter broadband,” said Dudley, who insisted that it does not cap data, does not make customers sign contracts and has never slowed traffic.

However, opponents say the deal would have the same effect as the proposed merger of Comcast and Time Warner, which was prevented by the US Department of Justice with US Attorney General Eric Holder describing it as the “best outcome for American consumers.”

Dudley dismissed the idea that the new prosed merger would be a similar duopoly to the one the regulators rejected. “We are a different company than Comcast,” said Dudley, “We don’t own any national programming interests, so that aspect of it is completely non-existent.”

One content provider, streaming service Netflix, does support the deal.

“Netflix believes that this new policy and the commitment to apply it across the ‘New Charter’ footprint is a substantial public interest benefit and will support scaling the Internet to meet consumers’ growing demand for online services and help foster continued innovation across the Internet ecosystem,” the company said in a July filing with the FCC. Charter has pledged not to charge for access to its network. The companies in the proposed merger have until November 2 to submit responses.

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