Mediaboss Marketing

When news broke that regulators had approved the Comcast/NBCU mega-merger in January 2011, I was at the annual State of the Net meeting on Capitol Hill. I missed most of the conference to hole up in my hotel room and write about the deal; the monster transaction would have more impact on the state of internet access in America than any panel discussion at the conference.

Heres why: With the addition of control over NBCUs wildly profitable cable channels (and NBC sports programming) to its existing commanding lead in territory for the provision of high-speed internet access, Comcast can make it just too expensive for any private-sector wired competitor to show up as a cheaper distributor of information, entertainment, data, and voice services.

High-speed internet is the stuff of modern life and the infrastructure America needs to thrive as a global competitor. But many of Americas great cities are now Comcast country when it comes to wired high-speed internet access. (And if youre not in Comcast country, youre probably in Time Warner or Cablevision country these companies dont enter each others territories.) The consumers bank account is suffering and were lagging as a nation, but Comcast is doing well.

Last December, the other shoe dropped: Verizon Wireless and Comcast agreed to market each others services. Verizon waved a white flag, implicitly agreeing not to compete with Comcast on the wired side of high-speed internet access by recognizing that the moat around Comcasts (and Time Warners) business was just too wide to cross. (As a practical matter, only Verizons FiOS can compete with Comcasts DOCSIS 3.0 services, but in 85% of Comcasts footprint there are no FiOS services. Because its too expensive to rip out copper and install fiber, Verizon isnt going to expand, leaving Comcast customers with no choice.)

The prospects Comcast are targeting with Internet Essentials arent customers it wants in the long run; the program, in a sense, filters out people who cant pay by readying them to pay later.

Comcast was also implicitly agreeing not to build its own wireless facilities, making Verizon Wirelesss business plans more certain.

And so the private providers of internet access in America are dividing the market you take wired, Ill take wireless which is all to the good for their shareholders, but not so great for the rest of us.

Now that it faces no competition from other private wired providers and is conceding that wireless was always a complementary service not a substitute for its wires even Comcast has to be just slightly worried that someone will notice that it is selling an essential commodity with zero oversight. Its as if a single company was providing water or electricity in your town and could choose whom to serve and how much to charge not something most Americans would think was a good idea.

Read the original here:
Water, Internet Access and Swagger: These Guys Are Good