DOJ Realizes That Comcast & Time Warner Are Trying To Prop Up Cable By Holding Back Hulu & Netflix

from the took-'em-long-enough dept

Thu, Jun 14th 2012 7:16am — Mike Masnick

For quite some time now, we've been reporting on how the big television players were so upset that Hulu and Netflix were dragging them kicking and screaming into the 21st century (even though they owned Hulu) that they were working on plans to kill off both services -- or at least cripple them. Mostly, what this goes back to is the inevitable fact that the internet is going to subsume television. But, these days, there's so much money in TV, thanks to the ability to be a gatekeeper, that all efforts are on holding back the internet for as long as is humanly possible. Want to know why HBO refuses to offer a standalone internet streaming option? It's because of the monopolistic power of cable.

This has all been pretty obvious for years, but the Justice Department has finally begun investigating Comcast/NBC Universal and Time Warner Cable to see if any of their actions with regards to Netflix and Hulu trip the antitrust wire. In particular, they seem focused on whether or not tiered broadband plans are actually designed to keep people from using competing online services, and preventing people from cord cutting. For Comcast, the risk may be much higher. As part of the merger with NBC Universal, it made certain promises to the government concerning how it treats online services. If it's not living up to those promises, it could mean trouble.

Unlike some other antitrust investigations, this is one where you can make a strong case that these companies are making life worse for consumers, by using their natural monopoly positions to keep prices artificially high. That said, I have little faith that the DOJ will get things right with the investigation. I think it's likely that the natural economic pressure of cord cutting (which, despite denials from Hollywood and the cable industry, is very very real) is going to have much more of an impact on the eventual massive reconfiguration of the television market than any antitrust lawsuit.

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Filed Under: cable, competition, cord cutting, doj, television
Companies: hbo, hulu, netflix, time warner

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Anonymous Coward, 14 Jun 2012 @ 7:21am

anyone point towards another industry/company that has a monopoly but then doesn't try to keep it by every and all means possible, including lying, cheating, bribing and instigating new laws to be implemented?
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- Rich, 14 Jun 2012 @ 7:55am
  
  Re:
  So, it's OK because other monopolies have abused their power too?
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  - Anonymous Coward, 14 Jun 2012 @ 8:14am
    
    Re: Re:
    I don't think that's what AC is saying. I think AC is making the observation that this isn't new behavior for companies.
    
    I tend to agree and it seems to me that this is part and parcel of the history of capitalism. Centralization/decentralization of capital/market share/power is the way history works.
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    - John Fenderson (profile), 14 Jun 2012 @ 10:11am
      
      Re: Re: Re:
      this is part and parcel of the history of capitalism
      
      As "invisible hand" Adam Smith himself observed, unregulated capitalism will naturally devolve into monopoly. This is one reason why it's impossible to have a free market without regulation.
      [ link to this | view in chronology ]
      - Mason Wheeler, 14 Jun 2012 @ 10:33am
        
        Re: Re: Re: Re:
        Adam Smith used the term "invisible hand" exactly once in The Wealth of Nations, speaking specifically of the benefits of keeping your commerce local instead of global.
        
        The way the term is used today has nothing to do with the way Smith intended it. But that's not too strange, considering that the way the term "capitalism" is used today has nothing to do with what Smith intended. What people call "capitalism" today is based far more on the writings of Ayn Rand, and bears a much stronger resemblance to fascism. Anyone who believes in what Adam Smith actually advocated would be decried by modern "capitalists" as a dirty commie.
        [ link to this | view in chronology ]
        
        John Fenderson (profile), 14 Jun 2012 @ 11:04am
        
        Re: Re: Re: Re: Re:
        Yes, all of this is what I was implying. :)
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        The Mighty Buzzard (profile), 14 Jun 2012 @ 11:34am
        
        Re: Re: Re: Re: Re:
        You should reread Rand. Though extremely long-winded and painful to read, there is no possible way you can take Atlas Shrugged as even remotely endorsing crony capitalism. Buying laws protecting businesses that otherwise couldn't compete was one of the central complaints of the book.
        
        As for monopolistic practices, Rand's protagonists thrived on rather than feared competition. Witness the National Alliance of Railroads (a private entity) and the Anti-Dog-Eat-Dog rule used to force Phoenix-Durango out of competing in Colorado.
        
        Seriously, Rand might have been a terrible writer but nothing you see in the so-called capitalism today can be justified by her ideals.
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        Mason Wheeler, 14 Jun 2012 @ 11:43am
        
        Re: Re: Re: Re: Re: Re:
        On the contrary, her central idea was that of a laissez-faire system without regulation, and 3 decades of aggressive deregulation have gotten us the current system, where businesses can do whatever they want, including buying bad laws. (As long as they're not directly about regulating businesses. Copyright doesn't count, of course, since that's obviously not about business regulation, it's about protecting our profits from evil, anti-business commies and content thieves.)
        [ link to this | view in chronology ]
        
        The Mighty Buzzard (profile), 14 Jun 2012 @ 11:59am
        
        Re: Re: Re: Re: Re: Re: Re:
        I know it's asking a lot but you really should reread it if you think that. You missed quite a bit.
        
        I'll grant you that she was pretty pissed off at communism. Quite understandable given her background. Anyone trying to sell that she was for any form of stifling competition though either didn't understand her work in the first place or hasn't read it in a while. There were too many examples of both public and private anti-competitive practices that her protagonists had to fight to even remotely claim that.
        
        Look, I'm not a Rand fanatic. I think she was a terrible novelist and somewhat short-sighted. My disagreement is strictly factual rather than idealistic.
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        Mason Wheeler, 14 Jun 2012 @ 12:03pm
        
        Re: Re: Re: Re: Re: Re: Re: Re:
        I'm not disagreeing with that. What I'm saying, which is also fact-based, is that the mess we have today is largely the result of people abandoning capitalism and following her policies instead, and that the results of doing so have not matched the results that her philosophy predicted should occur.
        [ link to this | view in chronology ]
        
        The Mighty Buzzard (profile), 14 Jun 2012 @ 12:57pm
        
        Re: Re: Re: Re: Re: Re: Re: Re: Re:
        She never really had policies though, just ideals. Most of her work was Why rather than How; what not to do rather than a comprehensive map of how it should be done.
        
        Someone taking a half-assed understanding of her philosophy (or deliberately misunderstanding it for their own gain) and making policy out of it can't really be laid on her shoulders. I'm fairly certain she'd have some righteously pissed off words to say about what was done with her message if she were still around.
        
        My philosophy is, in general, the government should stay out of competitive matters. Right up until someone does something anti-competitive. Then they should come down on them like a ton of bricks.
        
        Truly anti-competitive mind you. Simply being too good for anyone else to beat isn't enough. Any action aimed at stifling competition though is. Including pretty much all exclusive contracts, even if the parties aren't dominant market forces.
        
        The "in general" above because there are times when the system breaks down and the government should take steps to restart competition in a sector. That power should be used exceedingly sparingly and only when absolutely necessary though. Monopolies hurt the involved sector of the economy but so does government meddling.
        [ link to this | view in chronology ]
        
        Jay (profile), 14 Jun 2012 @ 1:44pm
        
        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:
        Someone taking a half-assed understanding of her philosophy (or deliberately misunderstanding it for their own gain) and making policy out of it can't really be laid on her shoulders.
        
        But Alan Greenspan was her most devout follower. We see how that worked...
        
        The hard part here is that a lot of Objectivists seem to use her name for a lot of monopolistic behavior.
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        The Mighty Buzzard (profile), 14 Jun 2012 @ 2:17pm
        
        Re: Re: Re: Re: Re: Re: Re: Re: Re: Re: Re:
        Bingo.
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      - The Mighty Buzzard (profile), 14 Jun 2012 @ 10:58am
        
        Re: Re: Re: Re:
        Kind of goes without saying. Any freedom you that aren't willing to absolutely destroy the entity trying to remove it to keep? It was only ever yours on borrowed time to begin with. Be it metaphorical or actual, continued freedom is only possible at gunpoint.
        [ link to this | view in chronology ]
        
        Anonymous Coward, 15 Jun 2012 @ 7:56am
        
        Re: Re: Re: Re: Re:
        Look at what happened in Egypt yesterday or what happened in NYC last year. Hell they broke out tanks on their citizens in Florida even. Freedom is dead.
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    - Anonymous Coward, 16 Jun 2012 @ 4:56pm
      
      Re: Re: Re:
      Except this isn't capitalism. The cable monopolies are sort of the exact opposite of that.
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- Anonymous Coward, 14 Jun 2012 @ 7:55am
  
  Re:
  Monopolies are illegal in this circumstance.
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  - Anonymous Coward, 14 Jun 2012 @ 8:44am
    
    Re: Re:
    Except IPR
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- Anonymous Coward, 14 Jun 2012 @ 12:03pm
  
  Re:
  The always popular "everyone else is doing it" defence.
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- Anonymous plebeian, 14 Jun 2012 @ 5:12pm
  
  Re:
  You mean every big business that exists today?
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Zakida Paul (profile), 14 Jun 2012 @ 7:24am

Confirming what we have always known
The war on piracy is not about what is best for content creators, it is about power and control. The media companies want to control what we watch, and how and when we watch it. The Internet gives control to the viewer who can choose the medium and time on which they want to watch TV shows or movies. They can't have that and this is why we get terrible legislation like SOPA/PIPA/ACTA et al.

The sooner the media dinosaurs are gone and someone who understands technology is put in their place, the better. Then we might see some real progress.
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- Anonymous Coward, 14 Jun 2012 @ 8:10am
  
  Re: Confirming what we have always known
  it's not just the 'media dinosaurs' that need to begone, it's the majority of politicians that are of a similar age and of similar technical misunderstanding as well. unless there is a joint change, there will still be no progress, only total stagnation. we seem to be getting close to that now, so wont be too long!
  [ link to this | view in chronology ]
- geekamongus (profile), 14 Jun 2012 @ 11:46am
  
  Re: Confirming what we have always known
  Allow me to be the first to offer my services as the new CEO of Comcast. I will gladly step in for half of whatever the current CEO makes and guide the corporation down the path of Internet-based entertainment enlightenment.
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Brent (profile), 14 Jun 2012 @ 7:37am

Cable companies could make more money by offering internet plans with streaming cable channels available and charge a little more than their 'internet only' plan. I would totally pay a little extra for that (i'm talking maybe $10/month on top of my $50/month internet bill). All 'industry restrictions' aside, this would be a good move to transition into the TV/Internet market that would also preserve revenues from advertising and their 'traditional line-up'. This would also provide value user data that could help cable providers to structure how cable could best mesh with the internet to create/refine the next phase of their industry.

But whatever, 'screw your customers and hope for the best' might also work...
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- Zakida Paul (profile), 14 Jun 2012 @ 7:41am
  
  Re:
  Also, realise that the Internet is global and desist with the window release/geo blocking bollocks.
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- Grendel, 14 Jun 2012 @ 12:16pm
  
  Re:
  My wife and I have often said we would be willing to pay more per channel for "ala carte" programming than paying for the packages the cable companies offer. One of the packages we pay for we get 20 channels and only watch 4. Wasteful.
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  - PT, 15 Jun 2012 @ 11:34am
    
    Re: Re:
    The cable company in Longwood, Florida, offered an experimental "a la carte" service, along with other innovative services like movies on demand with pause and rewind, over a small area way back in 1993. It was extremely popular with subscribers, but the content providers shut it down. In particular, Disney Corp wouldn't provide any of the channels they controlled unless you took them all.
    
    The only kind of unbundling that would please me is if I could have cable internet without having to take the TV as well. My household will never, ever, pay for TV with commercials. It's a matter of principle.
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- Soli, 14 Jun 2012 @ 3:22pm
  
  Re: brent
  Cable companies would rather charge you for cable, which is a lot more than $10/month. They don't want you getting the same services online, because they know they can't charge you as much for it and they can't show you ads as effectively.
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Anonymous Coward, 14 Jun 2012 @ 7:41am

This is another reason why the government should have NEVER allowed Comcast to buy up NBC. I mean Duh, you don't see that Comcast would have a financial interest in keeping NBC from Comcast's competitors?

As Wall Street proved with their vulture capitalism that helped cause the economic mess, big corporations don't usually think long term profits, they think short term.

While long term it's a better idea for Comcast to have NBC make as much money as possible by making good deals with Hulu and Netflix, short term that undermines Comcast's revenue, and undermines Comcast's CEO and other top executives their chance to get big performance bonuses NOW, so they won't do it. Plus, less revenue coming in NOW might cost Comcast's CEO and other top executives their jobs if their board is too impatient to wait for long term returns.
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- :Lobo Santo (profile), 14 Jun 2012 @ 7:54am
  
  Re: Past Inclusive Restrictions
  Isn't there an analogue to this in the early US railroad industry?
  
  Something like: The train company would own the cotton farms, the clothing factories(?), the clothing stores, and the rails which it was all transported on... Or a thousand variations on the theme (logging camp, sawmill, rails... cattle ranch, slaughter house, cheese manufacturey, restaurants, etc, etc)
  
  Also, the movie studios owning everything from film production thru to actors, and theatres...
  
  And in the above examples, the tightly integrated vertical integration was deemed illegal--repeatedly.
  
  Given that the above *historical* examples were illegal, why was Comcast allowed to purchase NBC?
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  - Keii (profile), 14 Jun 2012 @ 8:00am
    
    Re: Re: Past Inclusive Restrictions
    I think what you are describing is called a vertical monopoly.
    Alas, it's probably the reason we won't see a Google service provider to use your Google phones with Google OS on.
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    - Mutiny32, 14 Jun 2012 @ 6:53pm
      
      Re: Re: Re: Past Inclusive Restrictions
      What if I'm making calls over Google Voice using my Android phone while connected to my home router connected to my Google Fiber account? (I will soon actually do this; I live in Kansas City.)
      [ link to this | view in chronology ]
  - Anonymous Coward, 14 Jun 2012 @ 8:02am
    
    Re: Re: Past Inclusive Restrictions
    Someone should create a kickstarter to buy out a movie studio and release all of the content to the public domain.
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    - Keii (profile), 14 Jun 2012 @ 8:10am
      
      Re: Re: Re: Past Inclusive Restrictions
      There isn't enough money in the world.
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      - Anonymous Coward, 14 Jun 2012 @ 8:46am
        
        Re: Re: Re: Re: Past Inclusive Restrictions
        Actually Wall-Street is probably able to buy it through shares
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      - PT, 15 Jun 2012 @ 11:42am
        
        Re: Re: Re: Re: Past Inclusive Restrictions
        "There isn't enough money in the world"
        
        I don't think that's true - the studios aren't that valuable. There are probably a number of individuals in the tech industry that could do it with their personal wealth. If a few of them got together they could probably take 51% control of the entire industry and asset-strip it to oblivion. I wish someone would do that to the RIAA companies.
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    - Anonymous Coward, 14 Jun 2012 @ 6:12pm
      
      Kickstarter
      Don't have to buy them out(...yet). Just put the bulk of your entertainment budget into Kickstarter-like projects that release their content into the Public Domain or a Creative Commons license. Starve the movie studios.
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  - jupiterkansas (profile), 14 Jun 2012 @ 8:58am
    
    Re: Re: Past Inclusive Restrictions
    The studios don't own the theaters. The government broke that up in the 1950s. That doesn't mean they aren't bed buddies, and the studios own everything else.
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  - MrWilson, 14 Jun 2012 @ 9:10am
    
    Re: Re: Past Inclusive Restrictions
    A good book on this topic is Organizing America: Wealth, Power, and the Origins of Corporate Capitalism by Charles Perrow.
    
    He points out that railroad companies were the start of the corporations. Basically, they were initially "public" companies with diverse shareholders and some government regulation, but the shares always consolidated in the hands of fewer and fewer wealthier shareholders. And the weak federal government and the various local governments that the railroads encountered didn't stop the railroads from...well, railroading them to achieve greater market domination and wealth. Like today's corporations, they played different towns and states off of each other by threatening to take their market-enhancing rails somewhere else if they didn't get incentives.
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  - Jeff, 26 Jun 2012 @ 4:59am
    
    Re: Re: Past Inclusive Restrictions
    Because corruption has become much more sophisticated than it was in those days.
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- Greevar (profile), 14 Jun 2012 @ 8:00am
  
  Re:
  Which brings up the subject of behavioral economics. The human brain is wired to seek out big short-term gains, despite the fact that such a pursuit is totally irrational. When money in on the line, people tend to do some very irrational things, like keep betting on a stock that they know is doomed until it blows up in the face. Offer someone $100 today and $102 tomorrow, they will take the immediate $100 even though $102 is more money. The same goes for these big companies. If they can get $100 million today, but they can get $102 million tomorrow, they will often take the $100 million today. The larger the sum, the greater the irrationality.
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  - Lord Binky, 14 Jun 2012 @ 8:04am
    
    Re: Re:
    I would say it's more like do you want $10 today or $1 a week for the rest of your life?
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    - Keii (profile), 14 Jun 2012 @ 8:11am
      
      Re: Re: Re:
      The movie industry wants both $10 today and $1 a week for the rest of their lives + 70 years.
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    - Greevar (profile), 14 Jun 2012 @ 1:32pm
      
      Re: Re: Re:
      The amounts are immaterial. The point is, even though they could hold out long term and get more money, perhaps a lot more money, they all tend to go for the instant gratification and walk away with their profits before the ship starts to sink. "Pump and dump", if you will. What's funny, is that because investors only care about instant payoff, the CEO's work against their own best interest to meet make the investors happy when it would serve them better to form a stable business with sustainable profits.
      [ link to this | view in chronology ]
      - PT, 15 Jun 2012 @ 11:54am
        
        Re: Re: Re: Re:
        Most of them are not working against their own interests at all. Only owner or founder CEOs have an interest in the long term fortunes of their companies. In the majority of public companies, the investors appoint mercenary CEOs who only serve for a few years and are mostly paid in stock. It's absolutely in their interest to inflate the stock price as much and as quickly as they can, then cash out and move on to do it again somewhere else.
        [ link to this | view in chronology ]
  - nasch (profile), 14 Jun 2012 @ 1:24pm
    
    Re: Re:
    Offer someone $100 today and $102 tomorrow, they will take the immediate $100 even though $102 is more money.
    
    That's not necessarily irrational. If I don't know you, I'd rather have $100 from you now than your promise that you'll give me $102 or even $150 tomorrow. The larger the sum, the more important it is to make sure to get it, and thus the more likely one will be to take the smaller sum immediately.
    [ link to this | view in chronology ]
    - Greevar (profile), 14 Jun 2012 @ 5:50pm
      
      Re: Re: Re:
      What makes my promise to give you $100 now anymore certain than my promise to give you $102 tomorrow? If I said I would give you $102 if you wait until tomorrow and you don't feel I would keep my promise, what reason do you have to believe that I would give you $100 now? No, either you believe that I would honor both options or you believe that I would honor neither. Thinking that "now" is a sure thing and "tomorrow" is uncertain is irrational. It doesn't make any sense to believe that I'm telling the truth about one and I might be lying about the other.
      
      What if I said I would give you $100 if you waited one year or $102 if you wait one year and one day? Would your rationale hold up then? I'd feel certain that your response would be, "I'd wait one year and a day. After all, it's only one more day and I get two more dollars."
      [ link to this | view in chronology ]
- Lord Binky, 14 Jun 2012 @ 8:01am
  
  Re:
  Why would you make horrible business decisions that are only profitable for periods of a quarter of a year to 10 years? Because that's what investors want, and investors are smart, and that's who you should listen to. Which is what the boards do, and therefore the executives that want to keep their jobs do. It's a great plan, because well, it works out great for investors until the shit hits the fan, at which point the smart ones have already left. The smart investor's profits prove it was all a good idea to start with, regardless of long term ramifications. Which is why you should always listen to investors, not matter how stupid the idea is in the long term.
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  - Q. Thomas, 14 Jun 2012 @ 7:43pm
    
    Re: Re:
    This is exactly how I feel about corporations. You have explained it expertly. Thank you.
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Anonymous Coward, 14 Jun 2012 @ 7:54am

I have Comcast. I'm forced to get a basic cable package in order to get broadband from them at a reasonable rate. When I signed up, it was literally $40 cheaper a month to have cable+internet than internet alone. I didn't even hook up the cable part up for months because I wasn't interested in it. And Comcast has some serious bill creep issues too. I started out at $45 a month and am not at $69 a month for same package. Some months it's up to $80 for no obvious reason. I'm always too busy and just pay it without question because I need my internet connection for work.
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- Anonymous Coward, 14 Jun 2012 @ 8:31am
  
  Re:
  They told me it was cheaper but what ends up happening is it is cheaper per package but combined it is more expensive. I could get internet for $40.00 but would also have to pay $40 for cable. Or I could just pay the $69 for internet and not have cable.
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- Gina R, 14 Jun 2012 @ 11:48am
  
  Re: "Bill Creep Issues"
  It seems every Comcast customer experiences this. My mom, dad, and I (3 separate Comcast subscribers) experienced what you referred to as "bill creeping." That is why I cut my Comcast, even though it is my ONLY television option (hmm, sure sounds like a Monopoly to me). Dish and DirecTV are not available to my building and there aren't any other cable companies in my area! I sat on the phone for hours with Comcast, trying to nip the problem in the bud, but they always had a reason (e.g. the rates for your county went up, not us; for the HD box I DIDN'T have, etc.). I will gladly give a small start up TV company my money to see Comcast brought down to size.
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- Whatever, 15 Jun 2012 @ 7:41pm
  
  Re:
  Forced? You're forced to? That might be the slightest bit of hyperbole, don't you think? Look, if you think you can do better elsewhere, freakin' go.
  [ link to this | view in chronology ]
- Michael Hirsch (profile), 24 Jul 2012 @ 6:45am
  
  Re:
  Comcast charges $15.00 more per month for their high speed internet if you do NOT also subscribe to their cableTV. In many areas of the country, their basic cabletv package is cheaper than $15.00 ... so there is an initial savings. The problem arises when, in other areas of the county, the basic cable fees (due to sweetheart deals with local government cable franchise agreements) are HIGHER than that $15 so-called "discount".
  
  This pricing model essentially forces people in the areas where there is a possible savings to go ahead and subscribe to basic cable to achieve the discount, even though they may in fact subscribe to satellite TV for actual viewing.
  
  This "sleight of hand" essentially skews the numbers of people actually viewing Comcast basic cable, and results in higher than actual eyes-on-the-screen numbers which impacts the reported cableTV subscribers communicated to any advertisers who contract with Comcast to display their products. They are basically lying to their advertisers.
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- Michael Hirsch (profile), 24 Jul 2012 @ 6:47am
  
  Re:
  Comcast charges $15.00 more per month for their high speed internet if you do NOT also subscribe to their cableTV. In many areas of the country, their basic cabletv package is cheaper than $15.00 ... so there is an initial savings. The problem arises when, in other areas of the county, the basic cable fees (due to sweetheart deals with local government cable franchise agreements) are HIGHER than that $15 so-called "discount".
  
  This pricing model essentially forces people in the areas where there is a possible savings to go ahead and subscribe to basic cable to achieve the discount, even though they may in fact subscribe to satellite TV for actual viewing.
  
  This "sleight of hand" essentially skews the numbers of people actually viewing Comcast basic cable, and results in higher than actual eyes-on-the-screen numbers which impacts the reported cableTV subscribers communicated to any advertisers who contract with Comcast to display their products. They are basically lying to their advertisers.
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kenichi tanaka, 14 Jun 2012 @ 8:17am

Hulu and Netflix, pardon my french, need to stop bitching about it.

First, while I agree that Comcast is a problem is regards to their product pricing for consumers (they keep raising prices on subscribers on a regular basis) they are not required to provide their content to online rental or streaming services. This would be a valid argument if Hulu and Netflix were a cable service or "televised provider" like broadcasters, but neither Hulu nor Netflix are broadcasters, they merely stream.

Second, Hulu and Netflix are trying to pull the same crap that Redbox and Netflix has been pulling with movie studios over movie rentals.

I don't see this going too far because there is no antitrust violation. Neither Hulu nor Netflix are a broadcaster so their complaint is baseless.
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- PaulT (profile), 14 Jun 2012 @ 8:30am
  
  Re:
  " they are not required to provide their content to online rental or streaming services"
  
  No they're not. They just don't get to whine when their customers find avenues to obtain content that don't benefit them (be that through competitors or piracy).
  
  "neither Hulu nor Netflix are broadcasters, they merely stream."
  
  Explain the difference.
  
  "Second, Hulu and Netflix are trying to pull the same crap that Redbox and Netflix has been pulling with movie studios over movie rentals."
  
  What "crap" are they trying to pull? Asking to be allowed to rent new movies to consumers is something to be attacked now?
  [ link to this | view in chronology ]
- Anonymous Coward, 14 Jun 2012 @ 8:38am
  
  Re:
  Comcast owns part of Hulu, and part of the antitrust case is Comcast possibly violating the favored nation clause for their other streaming service Xfinity by excluding it from their data cap when its watched on the Xbox 360.
  
  Part of tbe deal that allowed comcast to buy NBC was an agreement that they wouldn't hold their content back from competitors or favor their content over competitors.
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- Mesonoxian Eve (profile), 14 Jun 2012 @ 8:45am
  
  Re:
  Not to be rude, but your argument is so flawed, you're seeing the forest, not the tree.
  
  You need to go back in time a bit and examine just how Blockbuster failed. It had nothing to do with piracy, but the controlling forces which:
  A) it used blackmail to prevent BB from legally obtaining VHS/DVD or else it would blacklist the company from distributors. The same tactic was used on Redbox.
  
  B) it used its "we own it" stance to continually demand more royalties from BB, forcing the rental price to nearly $5 before it started closing stores. $5 for a rental is atrocious, especially when they were selling used DVDs for the same price.
  
  These tactics are now being used on streaming websites, the latest being Netflix be told to pay $16 million per movie to license.
  
  The entertainment industry has been violating anti-trust laws longer than I've been alive.
  
  And if we go back even further in time, to an era where Edison owned the patents on movie equipment...
  
  This industry is taking too long to fail.
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- Lowestofthekeys (profile), 14 Jun 2012 @ 8:55am
  
  Re:
  The consequences of what Comcast is doing is going to have far-reaching effects, mainly in decreasing market competition, which is bad for all of us.
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- DCX2, 14 Jun 2012 @ 9:46am
  
  Re:
  So Comcast not counting their streaming service toward your bandwidth caps, while simultaneously counting a competitor's streaming service toward your bandwidth cap...is not an antitrust violation?
  
  Riiight...
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  - Anonymous Coward, 14 Jun 2012 @ 10:20am
    
    Re: Re:
    Their arguement against this is that the data goes over their private network and never touches the public internet, while all content that goes over the public networks through their lines is treated the same, which is why Xfinity only ignored data caps for Xbox viewers.
    
    We will have to see if the courts see this as a violation.
    
    Either way, they have done away with data caps and are going to start charging more for heavier bandwidth useage.
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- John Fenderson (profile), 14 Jun 2012 @ 10:17am
  
  Re:
  Neither Hulu nor Netflix are a broadcaster so their complaint is baseless.
  
  What definition of "broadcaster" are you using? From where I sit, it looks like Hulu & Netflix are no more or less of a broadcaster than Comcast is.
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- JEDIDIAH, 14 Jun 2012 @ 1:16pm
  
  Monopoly abuse.
  People who aren't billionaires should stop trying to defend monopolies.
  
  Comcast and the rest should be regulated utilities. They are physical monopolies given subsidies and a favored status by the government.
  
  They are abusing their monopoly position to suppress rivals. The anti-trust implications here are pretty obvious.
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  - Anonymous Coward, 14 Jun 2012 @ 5:18pm
    
    Re: Monopoly abuse.
    They are government established monopolists and that status needs to change. The government needs to stop refusing to allow competitors to enter the market. This goes with just about every other market in existence including agriculture (Monsanto and patents), pharma & tech (patents), broadcasting and cableco (rights of way), govt established taxi cab monopolies (medallions), the hotel industry, the gambling and liquor industries, the live performance industry (ie: restaurants having to pay a parasite third party a fee to host independent performers or else be faced with potentially expensive lawsuits, even if performers agree to only play non-infringing music), the ability for children to draw custom pictures on birthday cakes without bakeries getting sued for potential infringement, the tax software industry (ie: Intuit and their lobbying of trying to prevent governments from allowing citizens to file certain tax forms online and the requirement that only govt. approved tax software can e-file), the restaurant industry and all the complicated rules and regulations surrounding it in many cities (which end up amounting to being anti-competitive), govt. established mailbox and electricity delivery monopolies (some electric companies don't even pay taxes), the finance and accounting industries (with strict rules that make it much harder for small entities who wish to practice both to do so), and it gets even more convoluted when you go down to the local level (ie: cities granting coffin sales license to single entities so no one else can can sell coffins, many restaurants cartels conspire with mayors to limit competition, etc...).
    
    In fact, very few industries don't suffer from anti-competitive laws. That needs to change. I'm very very very sick and tired of anti-competitive laws. They must all be abolished.
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- Anonymous Coward, 15 Jun 2012 @ 8:07am
  
  Re:
  Stating that Hulu and Netflix are not a broadcaster so there is no antitrust violation is just semantics. Consider it this way, is internet radio really any different when listening than broadcast radio? The same goes for Hulu and Netflix, whether it's streaming or broadcast is irrelevant, this is just the means of delivery.
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Manfred Manfriend, 14 Jun 2012 @ 8:22am

Sarcasm Mode Engaged:
This has all been pretty obvious for years, but the Justice Department has finally begun investigating Comcast/NBC Universal and Time Warner Cable to see if any of their actions with regards to Netflix and Hulu trip the antitrust wire.

nickcage.jpg Noooooooooooooooooooooo?

Seriously how retarded do you have to be to not see this happening?
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BoloMKXXVIII, 14 Jun 2012 @ 8:25am

Where they stepped in it
Comcast got into trouble because they put data caps on internet service but when they stream their own content to customers it does not count against the cap. Dual standards for bits traveling the same pipe.

I have little hope that DOJ will actually do anything about this problem. The DOJ is filled with the best politicians money can buy.
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- Anonymous Coward, 14 Jun 2012 @ 10:28am
  
  Re: Where they stepped in it
  It only ignored bandwidth caps if you viewed on the 360, their content was treated the same as competitors if you watched it on any other device. IE:watch Xfinity on a computer and it still counted against your bandwith cap.
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- Anonymous Coward, 16 Jun 2012 @ 4:47am
  
  Re: Where they stepped in it
  "I have little hope that DOJ will actually do anything about this problem. The DOJ is filled with the best politicians money can buy."
  
  The DOJ is filled with ex-MPAA and ex-RIAA associated attorneys. They shouldn't be allowed near these cases due to conflict of interests.
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Josef Anvil (profile), 14 Jun 2012 @ 8:31am

LoL
You have to love the cable companies' sheer arrogance. They cut into the telco market, which didn't expect VoIP adoption to occur as quickly as it did, and now they are underestimating cord cutting.

These "dinosaurs" depend on the public being afraid to migrate to new technology and for the most part they are justified in that thinking. The problem is that the internet has sped up the cycle of adoption. People communicate faster and to a broader audience now.

I don't think we will be seeing the "dinosaurs" going extinct, but they will have to evolve quicker than they want to.
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- Anonymous Coward, 14 Jun 2012 @ 8:43am
  
  Re: LoL
  I think its more than they want to hold on to the status quo until they are old enough to retire and let the upcoming generation of executives deal with the nightmare of cord cutting and figuring out how to navigate the new market.
  
  Pass the buck off and let it be someone elses problem.
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Anonymous Coward, 14 Jun 2012 @ 8:45am

They can sell all the cable they want. I'll not be buying. Can't have internet without cable? Can't use cable so no sense in getting internet from them. Not gonna pay for what I'm not going to use.

Instead of a customer, they get nothing.
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- John Fenderson (profile), 14 Jun 2012 @ 10:19am
  
  Re:
  Can't use cable so no sense in getting internet from them. Not gonna pay for what I'm not going to use.
  
  I wish I had that option. Where I live, the choice is between Comcast or dialup.
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  - TaCktiX (profile), 15 Jun 2012 @ 8:12am
    
    Re: Re:
    I'm fortunate that where I live the ISP/cable provider has very reasonable rates even if you're not bundling. They keep on trying to get me to bundle via mailers, but when I'm paying $50/month for 20/2 internet and I wouldn't watch TV anyway, nah.
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Zos (profile), 14 Jun 2012 @ 8:50am

http://www.indiegogo.com/calyx 16 hours left for the calyx institutes fundraising campaign. Thats the guy who wants to set up and end to end encrypted isp, with customer privacy as the mission statement.

Seemed like a good time to bump it.
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Anonymous Coward, 14 Jun 2012 @ 9:00am

None of these giants should exist. Its too obvious that they are oligopolies controlling the market. It should be illegal and at one point in America, it was. I've noticed too, the concentration of network ownership that they aren't even hiding it anymore that they own all these networks. They cross-promote and cross-televise now.
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Lowestofthekeys (profile), 14 Jun 2012 @ 9:01am

I'm interested in the question of whether Comcast is paying less for for programming options than Netflix is. If they have to regulate the pricing, and Netflix ends up having to pay less for streaming programming services, that could mean Comcast would have to lower their own prices to compete.
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Anonymous Monkey (profile), 14 Jun 2012 @ 9:20am

About time?
The only reason the DOJ is even looking into this is because somebody high-up got aggravated that they couldn't find the movie they were looking for on Hulu/Netflix even though it's been out for a while.
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2012 Calling, 14 Jun 2012 @ 9:32am

Time to Check Your Calendars. It's 2012.
Like Hollywood, its bastard offspring will die. But it won't be pretty (nobody ever said it would). It will be ugly and hideously noisy and smelly.

And like Hollywood, in a few years it will be all over, save the stench of decay of the bastard offspring.

And, like Hollywood, in a few years people won't know what "broadcast" means or who the f*** these people are. Nor will they give a shit.

How many young people own/buy/rent records, cassettes, 8-Tracks, VHS or Betamax tapes or CD's or DVD's or even Blu-Rays (a Trademarked name for nothing more than mega-DVD's with more anti-consumer features [which were nothing more than mega-CD's with more anti-consumer features]) or watch TV (what's that)?

Uh-huh. I thought so.

Where can I but a new Buggy-Whip?

More importantly, how do I buy me some of those hundreds of US Government Inc. laws to force you all to buy my stone wheels or else get arrested and jailed?

In 2012, no less.
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Eric, 14 Jun 2012 @ 9:50am

DOJ?
And with someone like Eric Holder leading the DOJ, I can almost guarantee that the DOJ will fail to uphold the laws against this kind of practice.
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Anonymous Coward, 14 Jun 2012 @ 10:15am

Claiming that this is a "natural monopoly" legitimizes the monopoly and it legitimizes the government's imposition of this monopoly. This monopoly is not legitimate and there is absolutely nothing legitimate about the government establishing these monopoly privileges. A more appropriate term would be a government established political monopoly because the only reason why these monopolies are government established is for political and selfish reasons like in return for revolving door favors and campaign contributions.
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Anonymous Coward, 14 Jun 2012 @ 10:17am

people need to grow a spine and cut the cable and stop patronizing these greedy bastards! We cut the cord 2 years ago and will never look back!
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Allan Smithee, 14 Jun 2012 @ 10:40am

Time Warner != Time Warner Cable
Your headline is misleading. Time Warner Cable is independent of Time Warner and has been since 2009. The cable company uses the name "Time Warner" under license.
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Shalyn, 14 Jun 2012 @ 12:35pm

Is it just me...
...or is it a little bit fishy that Comcast recently refused to comply with court subpoenas to provide information on users that fell under mass lawsuits from the major networks, and now suddenly they are under investigation for a practice they've been getting away with for ages?
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Guest, 14 Jun 2012 @ 1:58pm

Hulu is retarded; it still keeps ads even if you buy premium. Netflix is similarly gay, since its business started as a pop-up program paired with those dodgy "FREE $500 WITH COMPLETION OF OFFERS". Cable's probably the worst, but at least they fight for the right to pirate TV shows.
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- Wally (profile), 14 Jun 2012 @ 7:17pm
  
  Re: Hulu Is Retarded
  Ok, I do agree with Hulu Premium being stupid with advertisements. But at least they don't program your account to raise the volume of your commercial viewing like cable companies that do so to your set top boxes.
  
  Netflix may not be current or up to date, but that is because they have to liscense what they show and most of the good shows are on cable. You need to also remember Netflix didnt start as a streaming service. It's closest twin was GameFly. They didnt start with banner ads online but wirh TV comercials. They also had to license them as a rental service. The streaming sevice came along and cable companies pulled the plug on Liscensing certain materials to try to prevent people from completely switching over. Netflix is a legitimate service. They got big due to inexpensive services. Besides, who here has seen any cable show lately on th
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  - Wally (profile), 14 Jun 2012 @ 7:25pm
    
    Re: Re: Hulu Is Retarded
    ...on any of the broadcast channels that seem like they will last? Look at the new Charlie's Angrels revamp...canceled....point is they give us mostly crap and expect us to pay.
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Darren D, 14 Jun 2012 @ 2:48pm

Really now
Please people, stop whining. You don't need cable to survive. Just cancel it. You have the power to shut these industries down but you don't have the willpower. You get what you deserve.
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- jupiterkansas (profile), 15 Jun 2012 @ 7:19am
  
  Re: Really now
  Couldn't agree more. Between Netflix, Youtube, and the public library, I'm drowning with things to watch and it all costs me less than $10 a month.
  
  Things won't change until the cable money goes away.
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Anonymous Coward, 14 Jun 2012 @ 3:13pm

Holy crap...the government is doing something i agree with
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skinny poppy (profile), 14 Jun 2012 @ 4:23pm

More and more, DOJ = Denial of Justice, not Department of Justice.
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Belstain (profile), 14 Jun 2012 @ 4:51pm

I don't think cable cutting will be much of an issue. I think the bigger problem for the cable companies is the younger generations that will never see a need to sign up for their services to begin with.
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Wally (profile), 14 Jun 2012 @ 5:48pm

Cost
"This has all been pretty obvious for years, but the Justice Department has finally begun investigating Comcast/NBC Universal and Time Warner Cable to see if any of their actions with regards to Netflix and Hulu trip the antitrust wire. In particular, they seem focused on whether or not tiered broadband plans are actually designed to keep people from using competing online services, and preventing people from cord cutting."

It's the sole reason cable companies, or anyone offering TV services outside of online streaming, charge so much for the Internet services.

Comcast's biggest sin is capping data then throttling it. Now that 35GB limit doesn't seem like much of an issue. Until you find out they measure by throughput rather than data downloaded. The thing is, they don't measure it with their own online streaming service.

Time Warner's issue is cost. The only way you can get "sufficent" cost/speed ratios is when you bundle with the other two services they provide. Also, if you cut cable with Tim Warner, you cannot use their Internet because they are in the same lines.
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- Wally (profile), 14 Jun 2012 @ 6:42pm
  
  Re: Cost
  "Also, if you cut cable with Time Warner..." *
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PacWestContrib, 14 Jun 2012 @ 8:10pm

Content vs Distribution
I remember history when the studios owned the content and the distribution through theaters they owned and how antitrust was used for the common good to divest their stakes in the theater distribution - today we have internet as a distribution channel. We have new terms and technology but those old principles of content and distribution should still apply, studios should not own the "channel" and should definitely not be in the internet connection business.

Be a media company, step aside and allow Open Access to the last mile into our homes. We want a connection, and the companies competing for our connection. What we buy using our connection shouldn't be under the control of those with content.
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2jza80 (profile), 14 Jun 2012 @ 8:25pm

Wow
You all have a profound misunderstanding of how the telecom industry works. Cable companies do not own or produce the content. The studios decide who gets what and how much it cost. If you think that for one second that the studios will not charge Netflix an extreme amount of money to provide their content, just look at what your cale bill is. And yes everything is moving to the internet, but cable companies own the infrastructure there as well so....pay 150 for cable and data now And in the future pay 200 bucks for data. Dont think it will happen, Verizon is charging 50 for a gig of data service on new contracts...try downloading off that bandwidth more than 4 times a month...
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- Phoenx59, 15 Jun 2012 @ 4:55pm
  
  Re: Wow
  Comcast owns NBC/Universal, which makes it a cable company that both owns and produces content. As far as the cable owning internet infrastructure, they own much of it but not all of it. I myself use a high speed wireless not owned or affiliated with any cable company and around where I live we have a pretty good non-cable company broadband service as well.
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Anonymous Coward, 15 Jun 2012 @ 7:59am

They cable and broadband business should be split up now just like what they did with the phone companies.
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cj, 15 Jun 2012 @ 12:14pm

They fight change
If you go to the large cities notice cable providers share. But really do they? Not really. It's like they made a grid out of the sections of the city, and certain cable companies advertise the crap out of their service for that area. Switch areas, and another cable company is advertising the crap out of area.

Now go to a small town. You will see either one, and they are pushed, or the norm is they are the ONLY cable company in that small city. If you notice they also have like grid areas they are set up in.

Now look at towns that have the norm cable company but they have their OWN local cable company. Notice the local cable belongs to the city, or a local business person. If you look at their background something interesting pops up. Most had to sue the major cable company for the privilege to set up shop in that town. The major cable company sued them.

Another thing you will notice is the harder for the main cable companies to set up cable in a town the more chance they wont. Quite a few towns around the USA don't have cable because they are in mountain regions, or located off the beaten path. The major players don't want to spend a dime on these places. So these rural areas rely on Satellite or nothing.
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