Washington Post, Free Press take opposing sides on Comcast-TWC merger

The Washington Post editorial board has thrown its support behind Comcast's (NASDAQ: CMCSA) $45.2 billion acquisition of Time Warner Cable (NYSE: TWC) with the proviso that "regulators will respond if big industry players begin to violate basic principles of market fairness."

In an editorial that balanced the views of supporters of the bigger-is-better mantra and those who believe the merger will create a mega-company bent on controlling the communications and entertainment space and raising prices for end consumers, the Post writers concluded "in the real world, the outlook for the future of communications and entertainment is foggier than either scenario suggests."

While noting that the uncertainty of the market "recommends a degree of regulatory caution," the newspaper concluded that it is "not grounds to take the severe step of blocking a proposed merger."

Consumer advocate group Free Press, an ardent opponent of the acquisition, disagreed. Comcast, the group pointed out, has a track history of raising prices and is, in fact, the industry leader in that category. It is a trend the organization expects would continue and expand if the company is allowed to get larger.

"Comcast's rate increases far outstripped those of its competitors in recent years. And the very company it's intent on gobbling up actually lowered basic cable prices in the period studied."

The trend, the organization maintained, is an indicator that "bigger is most definitely not better" when it comes to allowing Comcast to acquire TWC.

"If the Obama administration signs off on the merger, you can bet your bottom dollar--while you still have it--that Comcast's vast market power will allow it to dictate prices no matter which company is your actual cable and Internet access provider," the Free Press blog item concluded.

For more:
- The Washington Post has this editorial
- Free Press has this blog post

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