Franken’s Opposition to Comcast/TWC Centers on Cable Giant’s Lobbying Power

"They have 107 lobbyists on Capitol Hill,” Franken said during The Communicators episode. “They're swarming Capitol Hill, their lobbyists.” But I've had “100,000 people, more than 100,000 people, write me their objections. The first thing I would do is stop this deal. I would not let this go through. But it’s not up to me.”

The FCC and Justice Department must approve the proposal. Franken explained that the 100,000 people he mentioned had responded by email or written letters to a survey Franken posted online shortly after the deal was announced. “People talk about how lousy the service is,” Franken said, stressing that these responders opposed the deal. Franken has attacked the Comcast deal before Congress as well as in his Senate campaign and repeatedly alludes to the corporate influence Comcast has. Comcast laid out its case Tuesday in a public interest filing before the FCC that spanned more than 600 pages (http://bit.ly/1gSexCO).

Comcast deployed 107 lobbyists in 2013, as tallied by the Center for Responsive Politics, and has hired lobbyists with antitrust specialties this year. It recently hired Seth Bloom, for instance, a former general counsel for the Senate Judiciary Antitrust Subcommittee. Last week a lobbying registration form revealed that Comcast hired The Normandy Group, too, which includes the lobbyist Louis Dupart, another former antitrust official who once worked for that Senate subcommittee. “Louis has had multiple successes at the Department of Justice and the Federal Trade Commission on major anti-trust reviews for DuPont, Google, People Soft and other companies,” the Normandy Group touted on its website (http://bit.ly/1esEwXe). In 2013, Comcast spent $18.71 million on its own in-house lobbying, not counting the millions spent on outside lobbyists.

Initial 2014 Q1 lobbying reports show Comcast lobbyists are focusing on the Comcast/Time Warner Cable deal with lawmakers. These reports are not due until April 21 but eight Comcast lobbying firms have already filed theirs, many explicitly mentioning the proposed merger. In Q1, Comcast paid Thorsen French Advocacy $80,000, the Palmetto Group and the O Team $60,000 each, the American Continental Group and Hannegan Landau Poersch Advocacy $50,000 each, Paul Unger $45,000, the Mathis Group $30,000 and Bloom Strategic Counsel $20,000, with more firms expected to file in the coming days, along with Comcast itself on its own behalf. Time Warner Cable paid the Downey McGrath Group $40,000 to lobby on issues including the merger in Q1, another form showed.

"Comcast spent almost $20 million in lobbying last year alone (only the military contractor Northrop Grumman spent more),” Free Press President Craig Aaron said in a Huffington Post blog post Thursday (http://huff.to/1qHnhkI). “Will an outraged public be able to counteract Comcast’s lobbying onslaught? Can organized people beat organized money? Well, it’s the only thing that ever has.” Aaron criticized Comcast for failing to “make the case” at Wednesday’s hearing. Free Press has joined with other groups, such as Common Cause and Demand Progress, to oppose the deal.

Of the lobbyists Comcast employed last year, 86 of the 107 were labeled as part of Washington’s revolving door, with experience on the Hill informing their current activities as lobbyists, according to the Center for Responsive Politics. The 107 lobbyists included five former members of Congress, such as former Rep. Chip Pickering, R-Miss., from when he lobbied at Capitol Resources before he joined Comptel as CEO in January (CD Dec 6 p21), and former Sen. Blanche Lincoln, D-Ark. Comcast’s own lobbying shop employs Meredith Baker, a former Republican FCC commissioner who voted to approve Comcast’s acquisition of NBCUniversal when she was at the agency. Observers have widely pointed out Comcast’s donations to politicians as well as the connections of top Comcast officials -- such as CEO Brian Roberts and Executive Vice President David Cohen -- to President Barack Obama, as important dimensions of their corporate influence. Roberts has golfed with Obama, and Cohen has raised money for him.

Cohen had testified for Comcast Wednesday, insisting repeatedly that the deal would be good for consumers. Comcast and Time Warner Cable don’t directly compete, Cohen said. Cohen “seems like a really smart guy and is a really great guy, I'm sure,” Franken said on C-SPAN. “But my job was to ask him tough questions.” Franken disputed the idea that the deal wouldn’t hurt competition. Comcast’s Roberts, when arguing the case for the NBCUniversal acquisition, pointed to Time Warner Cable as a competitor, Franken said.

"Comcast is the biggest cable TV company in the country, and it’s the biggest Internet broadband company in the country, and it’s wanting to buy the second biggest cable TV and the third biggest Internet broadband company, and that’s just too big,” Franken said, also emphasizing that Comcast “has about 12-13 percent of all television programming” with NBCUniversal. Comcast wants to bundle and says as much to investors, Franken remarked. He scoffed at the idea of a 30 percent threshold and said the idea of limiting a company’s market power to 30 percent “was about one sector,” not “all these pieces” that can be put together for greater leverage, he said: “Consolidation means leverage.” Cohen, speaking on Wednesday, doubted bringing Comcast’s size from 22 million cable customers to 30 million would give it any “wonderful leverage” over the market.

"It is clear from the Public Interest Statement that we filed last week with the FCC that Comcast and TWC don’t overlap and consumers will not lose choice in this transaction,” a Comcast spokeswoman told us by email in response to Franken’s latest comments. “The video, broadband and phone markets are all fiercely competitive.” The spokeswoman pointed out that markets have “continued to evolve rapidly” since the NBCUniversal deal four years ago and named competitors such as Netflix, Amazon, Google and Yahoo. “Verizon is now the #5 video provider, and in the last 5 years AT&T and Verizon have added 6.7 million subscribers, DirecTV and Dish added 1.2 million, while cable has lost over 7 million,” the spokeswoman added. Comcast’s percentage of the video market will be about what it was in 2002 or 2006 despite higher subscriber levels then, “as we've lost subscribers over the past decade to satellite, telco and other overbuilder competition,” the spokeswoman said.

"I'd like to see us do more hearings, but we'll see,” Franken added, saying he has a “running correspondence” with the FCC and Justice on this deal. Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., “has raised the possibility of a second hearing, and he will continue reviewing the public interest statement and submit further questions for the hearing record and await those responses,” a spokeswoman for Leahy told us Friday. “He'll use those opportunities to determine whether a second hearing is needed.”

The House Judiciary Committee plans to hold a hearing on the deal May 8. “This is a big deal and could have significant impact on competition in the United States,” Chairman Bob Goodlatte, R-Va., said during an episode of C-SPAN’s Newsmakers, which also was slated to be telecast over the weekend. (See separate report below in this issue). House Judiciary plans to take a look at how the deal would affect consumer choice in TV programming and “from the standpoint of what impact it has on the competitiveness of the companies that create the content that is aired on cable systems and other means that consumers get access to programming,” he said. Goodlatte wonders how the deal may disadvantage certain market players. (jhendel@warren-news.com)