Nvidia, TiVo Seek Conditions on Charter/TWC/BHN; Incompas Says Deals Hold No Public Benefit
Critics of Charter Communications buying Bright House Networks and Time Warner Cable are continuing to lobby the FCC, seeking conditions or full blockage. The docket had been relatively quiet until the FCC paused the 180-day shot clock earlier this month, one cable industry lawyer told us. The shot clock resumed Wednesday and stood at 118 days Friday.
TiVo General Counsel Matt Zinn urged a variety of conditions for CableCARD be imposed on any regulatory approval of the deals, reported an ex parte filing Friday in docket 15-149. Those conditions would have New Charter continue to provide CableCARDs to new subscribers until the company saw no demand for them for 24 months; continue to abide by the terms of Charter's integration ban waiver, which lets it stop offering CableCARDs to customers only when a third-party device compatible with Charter downloadable security becomes available at retail; and ensure retail navigation devices can access all linear channels making up a cable package at an equivalent service price. The terms of that waiver include indefinite support of CableCARDs and their self-installation; cooperation with third-party device makers wanting to use any downloadable security system Charter employs; and royalty-free licensing of hardware, specifications and codes needed for such downloadable security. The ex parte covered a meeting between Zinn and such FCC representatives as Chairman Tom Wheeler, Senior Counselor Philip Verveer and Owen Kendler, who is heading the FCC working team overseeing the deals' review. Charter didn't comment Friday.
In a separate sit-down with FCC officials -- including Kendler and General Counsel Jonathan Sallet -- Incompas CEO Chip Pickering and General Counsel Angie Kronenberg said an analysis by Global Economics Group's David Evans showed the $89.1 billion set of deals would cause "a significant increase in the prices that video programmers pay for access and distribution to [New Charter] households," with the end result being that New Charter's increased market power over video programmers would hurt competition and new entrants in local broadband, it said in an ex parte filing Friday. "There is no dispute in this docket that larger multichannel video programming distributors ... pay substantially lower prices than smaller MVPDs for video programming," Incompas said. It said Charter/TWC/BHN, "if approved, would substantially increase the bargaining power of New Charter over video programmers," and that counteracts any primary public interest benefit as claimed by Charter. Charter called Evans' analysis "incorrect and illogical" (see 1601200043).
Nvidia also is seeking conditions on the deal. Its filing Thursday said the FCC should condition approval of the deals on prohibitions stopping Charter from blocking or interfering with use of its Shield TV home entertainment system "and other lawful, non-harmful devices." Nvidia said the cable company's TV Everywhere authentication process stops Shield TV from working with a variety of TVE apps.
Other opponents -- including Dish Network, ITTA, Public Knowledge and USTelecom -- Thursday unveiled the Stop Mega Cable Coalition to jointly oppose the proposed transactions (see 1601210028). In a statement on the formation of that group, which is similar to the anti-Comcast/TWC group Stop Mega Comcast, Charter said it's "a different type of cable company -- committed to creating American jobs, offering the most innovative products, delivering fast internet speeds, preserving an open internet and advancing online video friendly policies including no data caps and no modem fees. It should come as no surprise that Dish and other parties seeking to use the regulatory review process to extract concessions are also engaging in tired PR tactics to further their self-interests. Their arguments against the pending transactions are baseless. The facts are that New Charter has received significant and broad support from leading [online video] provider Netflix because of its online video friendly practices, independent programmers including Fuse Media and RFD-TV due to its commitment to diverse programming, national multicultural organizations like National Urban League, National Action Network and the League of United Latin American Citizens with whom it is collaborating to expand diversity and inclusion, and from the State of New York which recently approved the merger. These parties have taken a close and honest look at the benefits of these transactions and have all come to the same conclusion: they are in the public interest.”