High Speed Access was the Relevant Market for Antitrust Officials Looking at Comcast Bid to Buy Time Warner Cable

I may have an overly-simplistic way of looking at the odds of big mergers in the access business, but there is a simple rule of thumb: antitrust opposition arises in the access business whenever any single provider is poised to exceed serving more than 30 percent of U.S. households.

It’s a simple rule of thumb, but it tends to work. In that regard, the Comcast purchase of Time Warner Cable, had it succeeded, would have given Comcast access to 84 million U.S homes, representing about 70 percent of the entire population, in a market where AT&T, the biggest provider in terms of homes reached, might potentially reach 50 million homes.

If total U.S. homes are about 123 million, and occupied units are about 116 million, then Comcast would have had access to 72 percent of U.S. homes. AT&T, by way of contrast, has access to 43 percent of U.S. homes.

“Access” is different than “active account at that location,” though. Since there are two to four major suppliers of any single service in every market, the market share held by any single provider is a fraction of total addressable homes.

AT&T knows it will not be allowed to increase its fixed network footprint. Comcast positioned its acquisition bid as being primarily about video accounts, where market share would have been held at about 30 percent.

Others had said the relevant “market” was high speed access, not video. Had the deal been approved, Comcast would have had about 57 percent share of the high speed market, and an overwhelming share of accounts in the fastest speed categories, and the widest footprint of gigabit and 2 Gbps service availability.
Post a Comment

Popular posts from this blog

Voice Usage and Texting Trends Headed in Opposite Directions

Jio is Succeeding at "Destroying" the India Mobile Market

What to Do About Industry Challenges? "Take the Package," One Exec Quips