A wave of mergers is causing media companies to get bigger -- to the detriment of consumers.
According to Politico
, the National Association of Broadcasters has spent almost $10 million lobbying Congress so far this year, with the National Cable and Telecommunications Association spending just over 8 million. Comcast has spent over 4.5 million dollars lobbying Congress for approval of its merger with Time Warner Cable this quarter alone – and as the PTC has previously observed
, Comcast spent almost $20 million last year to influence policy on dozens of issues, many not even related to entertainment.
This makes the entertainment industry one of the biggest spenders on lobbying in America. Last year, the NCTA spent more than double what the American Petroleum Institute and the Independent Community Bankers of America spent on lobbying.
If the merger between Comcast and TWC is permitted by Congress and the FCC, the enlarged Comcast will control 19 of the top 20 media markets in the country, 30% of the nation’s cable TV households, and almost 40% of broadband. A similar merger between DirecTV and AT&T would control another 27% of the pay-TV business.
And when some huge companies merge, they panic the remaining companies, who then also feel the need to merge with one another, thereby maintaining their market power. Recently, Fox chairman Rupert Murdoch (who controls, among other properties, the Fox Broadcasting network, Fox News, FX, and the 20th
Century Fox film studios) announced interest in buying out Time Warner (not the same company as Time Warner Cable).
As media companies expand and consolidate with one another, they grow ever closer to an oligarchy – a tiny group of vastly powerful corporations with little or no meaningful competition. As a result, the prices they can charge for their channels and services go up and up, with no alternative for consumers.
“Consumers have paid a heavy price for past mergers in the media and communications industries,” notes The New York Times
. “In the last 20 years, the price of cable and satellite TV services have more than doubled…Those higher prices have padded the profits of ever larger cable and media companies, while consumers have suffered through poor service” – not to mention being forced to pay for hundreds of channels they never watch. And the bigger they get, the more they’ll charge…and the less recourse dissatisfied customers will have.