Much of New Charter Brief Comment Traffic Driven by one Programmer
Of the 160,000-plus brief comments to the FCC on Charter Communications' proposed takeovers of Bright House Networks and Time Warner Cable, Herring Networks is claiming credit for close to a third due to its campaign targeting its viewers and potential subscribers. Whether those submissions carry any weight is debatable. Attorneys told us such comments are largely whistling in the wind because the FCC mainly looks at substantive statements that add to the analysis, and brief comments almost always are anything but.
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The programmer has a different view. Based on his meetings with FCC officials, Herring Networks President Charles Herring said that "it's clear to me they don't ignore the public filings -- I know it has an impact." Thursday was Day 180, the agency's goal of acting on deals, of review of Charter/TWC/BHN.
Many of the Herring-related comments (see here) laud its networks and say the FCC should stop New Charter if it comes at the cost of such independent channels. The agency also has received numerous form comments warning of price hikes, a wider digital divide and less consumer choice. The form letters come through No More Mergers, a joint effort by public interest groups including Common Cause, Daily Kos, Demand Progress, Greenlining Institute and Roots Action.
Herring said his company's campaign didn't provide any script: "We just asked our viewers to respond with their thoughts and opinions." The company has pushed for conditions in Charter/TWC/BHN (see 1602220061), and Charles Herring said the campaign was motivated both by the impending deals and also in an effort to push the idea to the FCC of the difficulties that independent networks face in general -- the topic of a notice of inquiry now before the agency (see 1602180044). Charter didn't comment on the Herring-generated traffic.
If the number of comments reaches a certain threshold, it can demonstrate a particularly high level of public attention in a proceeding, lawyers told us. But commissioners generally don't rely on brief comments for anything other than gauging public interest, said a communications lawyer with a client involved in Charter/TWC/BHN. The number of Charter/TWC/BHN comments likely isn't particularly significant, especially in comparison with the 4 million-plus public comments received in the net neutrality proceeding, the lawyer said.
The hundreds of thousands of comments received in Comcast's ill-fated attempt to buy TWC often involved customer service and consumer issues. Those matters aren't what drove the FCC analysis, one lawyer with deal review experience at the FCC told us. While public comments generally don't influence outcomes or staff analysis, whether they generate lawmaker interest is another matter, the lawyer said.
The FCC didn't comment on when it expects to decide on Charter/TWC/BHN. Charter in a statement said it "continue[s] to work productively with regulators and look[s] forward to obtaining approval soon.” In a letter in docket 15-149 Thursday, Lynne Montgomery, aide to Media Bureau Chief Bill Lake, said the agency also has received a number of voicemails in the proceeding. "In general, these voicemails were opposed to the merger and expressed concerns that the merger would harm competition, cause service quality to drop and cause prices to rise," the letter said.
Charter and its critics continue to lobby the agency. In an ex parte filing Thursday in the docket, Charter recapped a meeting of executives including Catherine Bohigian, executive vice president-government affairs, with FCC staff including Owen Kendler, who has been heading the commission working team overseeing the deal, at which Charter discussed the public interest benefits of the deals and New Charter's commitments, plus how the agency could enforce those commitments. In its ex parte filing in the docket Thursday, Zoom Telephonics said in a conversation with Brendan Holland, chief of the bureau's Industry Analysis Division, it urged a requirement would block Charter from extending its set-top box pricing and billing policies to TWC and BHN, otherwise other multiple-system operators might follow suit -- which Zoom called "a step in the wrong direction and ... at odds with the goals that members of the Commission have expressed in seeking to create a retail market for set-top boxes." And NRBTV Thursday in a filing in the docket said it opposed Charter/TWC/BHN, arguing that it's carried on DirecTV but it can't get carriage on any "of the top cable systems," including Charter, TWC and BHN, and obtaining such carriage would be even tougher in a New Charter world. "The Merger will only embolden and exacerbate the silence of [multichannel video programming distributors] and nonbroadcast content providers like NRBTV will be left out of the carriage landscape even longer," it said. Charter didn't comment on Zoom and NRBTV critiques.
Once Charter/TWC/BHN and Altice's pending takeover of Cablevision close, "all U.S.-based cable operators will look to sell or swap systems to cluster footprints" since it would create economies of scale and could result in lower net acquisition costs, said FBN Securities analyst Robert Routh in a note to investors Wednesday. Such likely deals include Charter selling TWC's Sterling Manhattan cable system to Altice, or a sale or swap with Comcast, and possible industry interest in Cable One or Mediacom "as both are relatively small operators that seem ripe for a consolidation transaction," Routh said. Charter might also look to swap TWC's Kansas City operations with Comcast for Florida holdings that would fold well into BHN, he said.