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  • Not Good

    Posted by David Foster on January 20th, 2011 (All posts by )

    Some of the conditions attached by the FCC to the Comcast/NBC Universal merger should be raising serious concerns, and need a lot more attention/discussion than they are getting.

    Comcast will make available to approximately 2.5 million low income households: (i) high-speed Internet access service for less than $10 per month; (ii) personal computers, netbooks, or other computer equipment at a purchase price below $150″ and “we require Comcast-NBCU to increase programming diversity by expanding its over the-air programming to the Spanish language-speaking community, and by making NBCU’s Spanish-language broadcast programming available via Comcast’s on demand and online platforms.”

    Providing subsidized $10/month broadband Internet access to low-income households…or not..is a decision that should be made by legislative action. It represents in effect a tax on all existing Comcast customers for the benefit of the identified groups. For the FCC to take such an action absent explicit legislative authorization seems like regulatory overreach, to put it mildly.

    Even more important, there are issues of speech control here. It is no secret that NBCU programming has a generally leftist slant. Actions that broaden the distribution of this programming–which will surely be accomplished both via the additional Spanish-language programming and via the subsidized Internet access, which will assist Comcast in selling non-Internet services to the same households–will benefit the Democratic Party and the leftist movement in general. (Of course, once Comcast takes control of NBCU it has the ability to change the programming and will hopefully reduce the leftist slant, but large organizations have substantial inertia, particularly in industries as inbred and prone to herd thinking as the media field.) The precedent is not a good one.

    Thoughts?

     

    10 Responses to “Not Good”

    1. tomw Says:

      Hmmm… I thought

      “Congress shall have the power to tax…”

      was more or less the law of the land.

      http://www.usconstitution.net/xconst_A1Sec8.html

      The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and …

      Where do we get the power to tell ‘regulation makers’ No!

      tom

    2. Shannon Love Says:

      I think this reveals the hypocrisy and fallacy of anti-trust regulation.

      The FCC here is basically saying, “Well, your merger would create a trust and reduce competition but we will let you have your competition reducing trust if you provide a benefit for democrat-voting demographics.”

      If the merger creates a trust and reduces competition under the law, then it should be blocked period. Companies shouldn’t be able to bribe the government to let them form a trust. Conversely, if the merger wouldn’t result in a trust, then the government shouldn’t be using anti-trust regulation to shake down businesses.

    3. Marty Says:

      Ignoring the politics, this requirement is outrageous. I agree with Shannon—it the merger creates anti-competitive problems, they should be dealt with by modifying the merger or forbidding it outright if it cannot be fixed. But imposing requirements that bear no relationship to FCC’s purpose, well… there is a word for that: extortion.

      That’s our government in this Age of Obama… expropriation and extortion.

    4. Joseph Somsel Says:

      Agreed, these provisions attached to a proposed business combination are just partisan exploitation.

      The House needs to send a budgetary message to the FCC, just as it will to the EPA, that regulatory agency leadership SHALL stick to their legislated roles and live within their powers or risk shrinkage of the institutions they are entrusted with.

    5. Michael Kennedy Says:

      It’s reminiscent of the rules passed in enforcement of the CRA. Banks were threatened with regulatory punishment if they did not make enough loans to low income borrowers. That is where the “liar loans” came from.

    6. tehag Says:

      The airwaves belong to the people(‘s republic) even when transmitted over cable.

      This sort of thing is common. I’ve lived several places where compulsory good (in some people’s opinion, that is) is the law; namely: apartment complexes must reserve some number of apartments at a lower rate for low-income tenants. So too, the construction of bike paths. There is a fine line between requiring new real estate developments provide parks, curb cuts, bike paths, greenbelts, low-income homes, etc. and this. I don’t believe the burden to Comcast is all that great*, but I’d prefer the government not do this.

      For instance, I checked the local computer store’s ad. There were portable computers for $299 retail. Comcast could probably buy them bulk for $20. Unless “high-speed” is defined somewhere, Comcast would likely offer the lowest possible “high-speed,” probably V90. The Spanish requirement is more troubling, and probably illegal (I hope it’s illegal).

    7. Joseph Somsel Says:

      Mr. Kennedy and Mr. Tehag,

      The question becomes, were do we draw the line at what government can and can not do?

      Can the FCC require Comcast to provide free with all cable connections MSNBC? In my local jurisdiction, I can’t get FOX without charges for premium service. Could I get a politican to REQUIRE Fox as part of the city’s franchise?

      No, the citizens have to draw the line and impose it on the politicans and bureaucrats by voting the oversteppers out of office.

    8. David Foster Says:

      Note that what the FCC is doing here is using its control over a regulated activity (the use of license-requiring radio spectrum) as a mechanism for intervening in formerly non-regulated activities (sale of personal computers) and non-regulated content (programming carried on the on-demand and Internet platforms)

    9. tehag Says:

      I’d be happy to vote them out of office, but it doesn’t happen. Reagan promised to abolish the department of education, which wasn’t yet four years old. It’s still here. How much harder to abolish the FCC? And for which party exactly should I vote? Show me where any party, coming to power at the state or national level abolished whole government departments, leaving behind low taxes and millions of unemployed bureaucrats?

    10. Anonymous Says:

      “expanding its over the-air programming to the Spanish language-speaking community”

      Will this include English lessons or will I still be subsidizing press one for English two for Spanish (sarc off).