Proposed merger will test Comcast's sway in D.C.

Posted: February 24, 2014

WASHINGTON - The last time Comcast needed federal approval for a massive merger, it won widespread support on Capitol Hill, including from its home-state senators.

As reviews dragged on amid concerns about Comcast's growing size and influence, Sens. Bob Casey and Pat Toomey of Pennsylvania pressed the Federal Communications Commission in 2011 to say yes.

"The American people have waited for more than a year for the benefits of this transaction to come to fruition," they wrote of the Comcast-NBCUniversal merger. "It is time for a decision."

Now, as Comcast seeks approvals for another major expansion by acquiring Time Warner Cable, Casey, a Democrat, and Toomey, a Republican, are again cheering on a deal they say will boost their state's economy.

They are also on the long list of lawmakers who have been backed by Comcast campaign money. The cable giant may be derided by many consumers, but it has many fans in Washington, as evidenced by the dozens of members of Congress who wrote in support of its NBCUniversal purchase.

Comcast's latest merger will again test its influence amid another fierce round of lobbying and regulatory review. The results will have implications for tens of millions of people across the country who rely on Comcast and Time Warner Cable for television and Internet service. Consumer advocates are already warning the deal could give Comcast unprecedented market power and lead to higher rates.

Congress has no official role in the decision - that's up to the FCC and antitrust agencies - but lawmakers are planning hearings and will make their voices heard.

Many already know the Philadelphia-based Comcast well.

The company spent $18.8 million on lobbying federal lawmakers and regulators in 2013, seventh-most among all entities, according to the nonpartisan Center for Responsive Politics. It outspent Google, ExxonMobil, Verizon, and Boeing, among others.

Comcast and its affiliates have also given $2 million to candidates so far in this election cycle - 16th-most, according to the watchdog group. Much of that money flows to lawmakers from the Philadelphia area, but also to congressional leaders in both parties.

Among the top recipients: House Speaker John Boehner, Senate Majority Leader Harry Reid, Senate Minority Leader Mitch McConnell, and Rep. Greg Walden (R., Ore.), chairman of a subcommittee that oversees communications and technology.

Aides to Casey and Toomey, as well as Comcast and even some of its critics, say it's unfair to suggest campaign donations buy support.

"It is never as simple as you go in, you write a check, and you get a letter," said Harold Feld, senior vice president of Public Knowledge, a consumer group that has criticized Comcast and the Time Warner Cable merger.

Some lawmakers Comcast contributes to still oppose the company on various issues, and, Feld noted, Comcast's rivals also give to campaigns.

"It's demeaning to elected officials to suggest that their support can be bought," said David L. Cohen, Comcast's executive vice president and top government-affairs official. "There's never any quid pro quo."

Officials, Cohen said, "make all their decisions based on the merits."

Cohen, best known in Philadelphia for having served as chief of staff to Mayor Ed Rendell, has in recent years built a reputation at Comcast as one of Washington's preeminent movers. He hosted President Obama at a top-dollar fund-raiser at his West Mount Airy home in 2011, more recently raised money there for Toomey's campaign, and this month was a guest at a state dinner featuring French President Francois Hollande.

He and other Comcast leaders have argued that the deal with Time Warner is "pro-consumer" and won't hurt competition.

Those who backed the NBCU merger saw a move that would reinvigorate the network, create jobs, and help their constituents, he said.

At the same time, Cohen acknowledged that Comcast makes campaign donations to "support an agenda that is supportive of the company," and that its lobbying had ramped up as the company expanded and faced complex rules in a highly regulated industry.

Comcast employed more than 100 lobbyists in 2013, according to the Center for Responsive Politics. The team last year included five former members of Congress and Meredith Atwell Baker, a former FCC commissioner whom Comcast hired four months after she voted in 2011 to approve its purchase of NBCUniversal.

Rivals and admirers alike say the company is savvy, nimble, and effective when it comes to persuasion and power.

The Comcast-NBCUniversal merger, for example, brought waves of political support.

Though some lawmakers raised concerns - "I worry that a media merger of this size has the potential to leave consumers with lesser programming and higher rates," wrote Sen. Jay Rockefeller (D., W.Va.) - others saw government regulations as a hindrance.

During the review of that merger, Casey and then-Sen. Arlen Specter (D., Pa.) wrote to the FCC touting Comcast's work in the community and the economic benefits of its deal. They urged regulators not to "impose additional, burdensome commitments" that could deter investment.

Impatience built fast, even as the FCC received more than 29,000 public comments and filings and twice sought additional information.

"The commission should act on this pro-consumer, pro-competition transaction without delay," 22 House Republicans wrote to the FCC about three months into its formal review, before the public-comment period had even ended. "The longer the commission takes . . . the longer current and potentially new and innovative jobs remain in limbo."

For many lawmakers, of course, support for business and opposition to overregulation is a core belief. One of the letter's backers, Rep. Bob Latta (R., Ohio), has sponsored a resolution saying that when it comes to growing the telecom and technology industries, government "should 'get out of the way and stay out of the way.' "

Comcast's muscle on Capitol Hill was perhaps best reflected when 97 House members wrote the FCC urging prompt action and fewer conditions on the Comcast-NBCUniversal deal.

"Any further delay in your agency's review process," said the 2011 letter, "and any further efforts to laden the transaction with formal regulatory requirements could undermine much-needed jobs and investment." It was signed by eight members of Congress - Democrats and Republicans - from Philadelphia and its suburbs, many of whom have been among the top recipients of Comcast donations.

The Time Warner deal, however, has brought a more muted reaction, at least initially. Most lawmakers have remained quiet.

Casey and Toomey were exceptions. They immediately praised the merger's potential benefits for Philadelphia and Pennsylvania. Comcast employs 13,000 people in the state, including more than 6,000 in the city, Cohen said.

Casey received $73,775 in contributions from Comcast and its associates in his last reelection race, in 2012, according to the Center for Responsive Politics, more than anyone that cycle except Obama and Mitt Romney.

Toomey, up for reelection in 2016, has received $17,900 from Comcast this cycle, among the most of any lawmaker.

Aides to both senators said their support of the Comcast-Time Warner pact was about jobs.

"It's good for Philadelphia and Pennsylvania's economy and job market," wrote Toomey spokesman Steve Kelly. "Other factors did not come into play."

Feld, of Public Knowledge, saw the relatively quiet response from most lawmakers as a sign of a changed political environment.

The Comcast-NBCU deal arrived in 2010 amid the rise of the tea party movement, driven by widespread fears of an overreaching government and a deep economic crisis. Siding with regulators was unpopular.

Now, with income inequality an increasingly potent topic, standing with a big business seeking to get bigger may not be as comfortable for some lawmakers.

"It's not clear who the electorate hates more at the moment," Feld said, "their cable company, or government."


INSIDE

Comcast deal is

a boon to area's economy, but to viewers?

Joel Naroff, D1.

The deal stirs mixed feelings.

Mark Zandi, C1.

It's great for the city, but how will it affect consumers? Editorial, C4.


jtamari@phillynews.com

@JonathanTamari

www.inquirer.com/capitolinq

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