"Like any transaction of this size, the proposed Comcast - Time Warner Cable merger deserves close scrutiny and I'm sure it will receive it. But it also deserves scrutiny that is based on the facts and that is free from the hyperbolic rhetoric that 'consumer' and 'public interest' groups and others deploy in reacting in knee-jerk fashion to any merger proposal involving large corporations. 

And the most important fact to keep in mind from the outset in considering this proposed merger is that it is what economists call "horizontal" and Comcast and TWC do not compete with each other in any material way in any market segment with respect to their broadband data, video, and voice telephony offerings. Instead, the real competition in the broadband marketplace, and the competition that public policy should foster, is between the various facilities-based platforms that are in direct competition with each other - the cable operators, the telephone companies, the satellite operators, and the wireless companies, all employing differing technology platforms.

Because the FCC reviews proposed merger transactions under the indeterminate 'public interest' standard, which can mean whatever any three of the five Commissioners say it means on any given day, the FCC often has abused the transaction review process by extracting conditions from the merger applicants that do not relate in any direct way to demonstrable competitive concerns raised by the merger. Before becoming FCC Chairman, Tom Wheeler, seemingly endorsed such untethered "regulation by condition" as a legitimate means for the agency to establish new regulatory paradigms over market participants. Using merger transactions in this way is an improper exercise of the Commission's authority, and I hope we do not see such "regulation by condition" down the road in the review of this merger.

I first wrote about the problematic nature of the FCC's merger review process in this 2000 Legal Times piece, "Any Volunteers?," and I have done so dozens of times since. That was the same year, by the way, that many of the same 'consumer' groups that will now oppose the Comcast - Time Warner Cable merger argued vociferously that, if approved, the proposed AOL-Time Warner merger would stifle any further development of the Internet and video markets in light of the merged companies' dominance. We now know how terribly wrong those predictions proved to be. Before jumping to any conclusions, some enterprising reporters might want to go back and retrieve those apocalyptic press releases."