Grumbles>
A Marriage of Incompetents
Reflections on the Proposed Comcast-Disney Merger

Where I live, Comcast is the company people love to hate.  It has a monopoly on cable TV and, in many areas, on broadband Internet.  With this kind of unregulated monopoly, Comcast gets away with outrageous pricing, horrible or nonexistent service, and second-rate TV reception.  From experience, I know that cable reception from Comcast is like receiving TV from an antique transmitter in Communist China.  After years with a satellite dish, we briefly went back to cable but were so disgusted with the picture quality (even using Comcast's most sophisticated digital and HDTV boxes) that we invested in another dish.  The dish is a thousand times better than Comcast "digital," even for standard broadcasts.  The Internet service isn't half bad, but it still is a monopoly, and Comcast uses legal blackmail in its pricing:  we pay a premium for Internet service because we choose not to use Comcast cable.  (Comcast's take on this is that it gives a discount to customers who have both.  "Bull feathers!" I say.  It's a ploy to discourage customers from using Comcast's only TV competition – the dish.)

Now we read that Comcast is attempting a hostile takeover of Disney, a merger that would make Comcast the largest multimedia conglomerate of them all, bigger even than Time-Warner/AOL.  The move comes when Disney's fortunes are deservedly ebbing.  The Mouse House, sadly mismanaged by Michael Eisner, has become but a shadow of the company that Walt built.  It has lost market share by overcommercializing commercialism and by producing second-rate entertainment, with the exception of Pixar's animated films (and Pixar is making noises about filing for divorce).

In short, a merger of these two companies would be the coming together of two companies that long ago abandoned quality.  (In the case of Comcast, it's questionable whether the company ever embraced quality.)  It's bad enough that the Disney channel devotes a disproportionate amount of air time to ads promoting itself and that Comcast does the same with promotions of its services.  Can you imagine what it will be like when and if the two get together?  It will be like turning on the TV to watch nonstop spam.  (And, folks, we've already got that, courtesy of the networks.)

Comcast's stategy is transparent.  It got where it is by being an unregulated monopoly – not by providing a superior product or service.  When AT&T broadband posed a competitive threat, Comcast, instead of being competitive, simply bought it.  Now that Rupert Murdoch owns DirecTV, Comcast's deadliest possible competition, and is throwing millions (billions?) of dollars into increasing the reach and appeal of the dish, Comcast wants to enlarge its monopoly.  Its business plan is not to improve its content and service (that was never part of the thinking over at Concast) but to control more content and to make this content prohibitively expensive for erstwhile competitors to use.  We, the consumers, are all losers if this happens.

Of course, any such merger has to be approved by the FCC, which is supposed to prevent mergers that are contrary to the public interest (among other chores, such as investigating "wardrobe malfunctions" at Super Bowl halftimes).  But don't expect the FCC to do much.  In the first place, FCC chairman Michael Powell never met a merger he didn't like; in the second place, Comcast is already a monopoly that has proven itself not to be "in the public interest," but the FCC has done nothing, despite a rising tide of consumer complaints.

Newsweek put it well in its February 22 "Conventional Wisdom":  "Disney – Will Comcast be its wicked stepmother?  Any merger will likely leave the public with a pumpkin."


Copyright 2004.  Peters:  Dayton Daily News