In an industry that's already lacking in competition, Comcast (the leading cable provider in America) and Time Warner (the #2 cable provider) have agreed on a deal that would see Comcast buy out Time Warner's stock (LINK).
How in the world does this make it past the FCC and Justice Department though? Comcast thinks they will...
Comcast is prepared to divest three million subscribers, the people said. Those divestitures will keep its ownership of the pay TV market below 30%
...but the Justice Department recently shot down an attempt by AT&T to acquire T-Mobile, because it would have reduced competition in the mobile network industry too much.
My initial reaction to this was a negative one. I use Time Warner internet, and my first thought was "what will prevent Comcast from jacking up their prices once this goes through"...but then I realized, there's really nothing preventing Time Warner from jacking up their prices right now. There really isn't any competition as it is:
Comcast hopes to convince regulators that because cable companies don't compete, their deal should go through.
I still don't see what good is in this for us, the consumers. It will be interesting to see how this shakes out though.