Blockbuster Merger Between Charter, Cox Could Help Ensure American Dominance of 21st-Century Telecommunications

President Trump’s announcement and executive order to ensure that the United States dominates the artificial intelligence revolution was a welcome America First policy directive. That mostly means keeping the government out of the way.Yet an equally vital industry for our economic and national security interests is telecommunications — which is also going through warp-speed technology changes.Here, too, the government needs to keep its hands off. No subsidies. No lawsuits. Minimal regulations.This is why the latest $34.5 billion blockbuster merger between telecom titans Charter Communications and Cox Communications should get the green light from federal regulators.Some antitrust lawyers at the Federal Communications Commission and the Department of Justice worry this marriage would give Charter-Cox too much market share, allowing them to raise prices on consumers.Yet companies like Cox that provide internet and TV services over cable transmissions are soon to be outdated by the next generation of fiber, satellite, fixed wireless, and mobile broadband services.Customers are already “cutting the cable cord” in favor of more efficient and less expensive streaming video services and other digital alternatives.The synergies and economies-of-scale advantages driving the Charter-Cox merger, which will lead to a company with more than 37 million cable and internet subscribers, make sense.Is that too much market concentration?Comcast, the nation’s second-largest cable provider, serves about 12 million cable subscribers. Verizon serves just less than 3 million cable subscribers and approximately 146 million mobile subscribers.AT&T, another big player in this market, has tens of millions of customers of its own. AT&T is moving aggressively into satellite technologies and 5G to deliver calls, data, and video. AT&T and Verizon each have a market capitalization of well more than $100 billion. That compares to less than $50 billion for the Charter-Cox union. In other words, competitors aren’t going to be bullied out of the market by Charter-Cox — especially in the lucrative mobile communications arena.What is ironic is that back in the 1980s, AT&T was forced by the government to break itself up because of alleged market power, and now we could have federal regulators blocking a merger that would bring new competition to AT&T (and other big kids on the block, like Comcast and Verizon).As for the Charter-Cox potential dominance in cable, sorry, but that’s a declining industry.Within a decade or so, cable will be as outdated as Blockbuster Video.Mergers like this one make United States companies more competitive, make money for millions of American shareholders, and make our companies scalable to compete with European, Japanese, and Communist Chinese rivals.The assistant attorney general for the justice department’s Antitrust Division, Gail Slater, recently said she intends to focus on mergers that decrease competition: “If you’re violating the antitrust laws, we’re going to take a hard look. If you’re not violating the antitrust laws, we’re going to get the hell out of the way.”Those are words to live by.Creators.com

Blockbuster Merger Between Charter, Cox Could Help Ensure American Dominance of 21st-Century Telecommunications

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