News - September 2, 2020

INCOMPAS: Bigger Charter Wants to Punish Cord Cutters

WASHINGTON, D.C. (September 2, 2020) – Since it’s mega merger, cable giant Charter has only grown bigger with a greater appetite for harming streaming customers. That is the message from competitive focused INCOMPAS, the internet and competitive networks trade association who represents streaming services and internet edge companies who provide over the top video content.

In its comments to the Federal Communications Commission today, INCOMPAS criticized a petition from Charter, and supported by the Competitive Enterprise Institute, that would prematurely end consumer protections that help lower cost and more creative streaming options to grow.

“Millions of consumers cut the cord for a reason-- streaming offered a better product at a better price,” said Chip Pickering CEO of INCOMPAS. “Rather than compete in the new world, Charter and friends are hoping for price hikes, data caps and interconnection control that will enable them to milk more profits without offering new services.”

The INCOMPAS comments highlight the following concerns:

First, More Time: Charter and their supporters did not present economic analysis until late in the process, and the public deserves more time to respond.

Second, Bigger Charter: Charter’s market power has grown by 30% since the merger as the number of BIAS subscribers it serves today has increased by almost 9 million.  Accordingly, Charter has more incentive today than it did at the time of the merger to engage in behavior that will increase prices on consumers who often have no choice or only one other alternative for high-speed BIAS at home. 

Third, Charter is Wrong: Their notion that the merger condition was only to allow time for streaming to “flourish” is false. The conditions were specifically applied to (1) prevent post-merger anti-competitive action toward OVDs, edge providers, CDNs, and transit providers; and (2) address the lack of competition for high-speed terrestrial broadband internet services.

Fourth, Charter’s Word: Charter is telling the FCC to “just trust us.” But their record offers a red flag. Prior evidence in the merger proceeding demonstrated that Charter would engage in harmful behavior, especially as it relates to charging higher fees at the point of interconnection.

Fifth, No Competition: Charter now serves over 28 million customers, many of whom do not have other BIAS options to switch providers to avoid the price hikes Charter will impose, but for the conditions.

Sixth, 5G and Mobile is Not an Alternative to Fixed Broadband. Duh: The tired old argument that consumers don’t need a faster, higher speed fixed internet connect because they can just use their cell phone is even more absurd during the COVID-19 pandemic. But don’t take our word for it, AT&T CEO John Stankey who recently said: “I personally do not believe that 5G is a replacement in the near term for suburban residential single family living units.”

Finally, Data Caps = Consumer Price Hikes: The only reason Charter wants to impose data caps is to create artificial scarcity so that additional fees can be charged when customers use all their data. In other words, Charter will use data caps to increase prices as other large BIAS providers have done where they do not face effective competition.