Opponents of the Comcast-Time Warner Cable merger sure can hype.
First, critics are hyperventilating that the combination would be too big and powerful.
Columnist Paul Krugman gasps that Comcast is “gigantic,” Time Warner Cable is “huge,” and that the merged company would “be an overwhelmingly dominant player.”
Well, a merged Comcast would still have one-fifth the revenues of either “gigantic” Exxon or Walmart. Its business would be roughly half that of Apple, General Motors or General Electric.
And a merged Comcast would still be a third smaller by revenue than each of Comcast’s two largest direct competitors AT&T or Verizon.
Overall, about thirty American companies would each be larger than a merged Comcast by revenues, including five in health care, five in financial services, four in energy, three in tech, and two in communications.
As for being “overwhelmingly dominant,” any consumer that watches TV, listens to the radio or reads their mail knows from the constant bombardment of advertising from their communications business that they can take their video, broadband, or phone business to different competitors.
Second, critics are too hyper-critical of the merger’s effect on competition and the overall state of America’s communications competition.
The facts show that Comcast and Time Warner Cable are not competitors, so this merger will not eliminate a competitor in any market. Any fair review of the competitive facts shows that America has the most robustly-competitive facilities-based communications market in the world.
Moreover, the innovations of smart phones, tablets, WiFi, and LTE have revolutionized the way people view video and use broadband. For example, America’s world-leading 100 million LTE subscribers now enjoy better than video streaming speeds almost anywhere they go.
With the advent of wireless LTE video/broadband competitive substitution, the combined shares of Comcast-Time Warner Cable actually would be lower than the much-discussed high-end of 30 percent shares that are overstated without including LTE broadband competitors.