Is Comcast Too Good to Merge?

Federal regulators could punish the company for one of its strengths.

comcast-today-400x400Is Comcast too good for its own good?

Yes, we’re aware that the company routinely shows up on lists of America’s most-hated corporations. Yes, we’re aware of its reputation for customer service — a reputation that dogs the company so fiercely it has gone into full mea culpa mode for much of the last few months.

But Comcast didn’t get to be one of America’s biggest companies by selling consumers stuff they don’t want, either. One of the things they want: Access to high-speed Internet.

In fact, there aren’t many other companies providing high-speed access to the Internet to American consumers. (Try getting such access if you live in rural areas, for example.) And Comcast’s advantage in this area could actually spoil its proposed merger with Time Warner Cable.

Here’s how it breaks down, according to a new story from the Los Angeles Times:

• While FCC regulators have been considering whether to approve the merger, the agency has also contemplated encouraging expanded high-speed Internet access across the country — mostly by changing the official definition of “high-speed” Internet: Right now, download times of 4 MB per second are considered “high speed.”  A new proposal would raise that minimum speed to 25 MB per second.

•Comcast is one of the few companies that offers Internet service with enough capacity to handle the load,” the Times reports. “If the FCC raises the threshold, Comcast might end up with an even greater market share than it currently has.”

• Thus the problem: That greater market share could be viewed as “anticompetitive.” That could lead regulators to scuttle the merger.

Really.

We’re not libertarians here. There are genuine concerns to be found about Comcast’s ability to dominate the Internet and cable markets and thus put seeming competitors at an unfair disadvantage. (The L.A. Times story gets into that, a bit, too. Worth reading the whole thing.)

On the other hand, it seems tremendously unfair for regulators to take a look at one of Comcast’s real strengths — the ability to offer higher speeds than many other American Internet Providers — then change the rules in the middle of the game, to Comcast’s disadvantage.

Penalize the company for its customer service. Make it swear to officially support net neutrality for another 20 years. (Right now, the company is required to do so as part of its acquisition of NBCUniversal a few years back.) And punish it if it engages in genuinely anticompetitive practices. In truth, Comcast is (or might be) vulnerable on those counts.

But penalizing the company because it already provides the kind of service the FCC says it wants more of in America? That’s nutty.

Being good at something should never be the reason the government deprives you of an opportunity. Lots of bad stuff gets said and written about Comcast. This time, the company deserves a defense.

Follow @JoelMMathis on Twitter.