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Ergen says no to Charter/TWC merger

Charlie Ergen’s Dish Network has filed a formal response to the proposed Charter Communications merger plan with Time Warner Cable. In its letter to the FCC, Dish outlines how the applicants have failed to prove that this proposed merger is in the public interest and reiterates its call for the FCC to deny the merger.

“If the proposed merger is approved, 90 per cent of the nation’s high speed broadband homes would be controlled by two companies, and the combined ‘New Charter’ would have every incentive to sabotage OTT services like Sling TV that compete with the old school cable bundle,” said Jeffrey Blum, Dish senior vice president and deputy general counsel. “The proposed merger is harmful for consumers, competition and innovation, and should be denied.”

Specifically, Dish argues that OTT services such as Sling TV would be under threat. Dish says that a ‘new’ consolidated Charter/TWC “will be able to deploy another win-win strategy to make its broadband business more profitable, while still protecting its linear video business: raise the price of broadband access either directly or indirectly”.

The response adds: “The Merger Will Create a Dominant Duopoly with the Incentive to Engage in Anti-Competitive Parallel Conduct: As Dish explained in its Petition to Deny, this transaction will create a broadband duopoly, with Comcast and New Charter controlling about 90 per cent of the high-speed broadband homes in the country. Parallel action, with one of the two following the other, will be enough to foreclose an OVD from almost all high-speed homes in the country.”

Dish’s final major point is that the merger’s claimed “benefits” are Nothing More than Repackaged Plans and Conjecture: “Charter also fails to provide any evidence that the combination of Charter with TWC and BHN is necessary to achieve many, if not all, of the benefits it touts. From infrastructure through jobs and cost savings, Charter has offered little more than recycled (non-merger-specific) business plans and conjecture.”

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