Charter/TWC/BHN Has Three Votes With Rosenworcel, O'Rielly Supporting
A majority of commissioners have signed off on Charter/TWC/BHN approval, with it now in "must-vote" status, FCC and cable industry sources tell us. Commissioner Mike O'Rielly approved Charter Communications' buying Time Warner Cable and Bright House Networks, with dissents in some parts, while Commissioner Jessica Rosenworcel also approved, an FCC official told us. The official didn't provide details on the dissents. Meanwhile, Commissioner Ajit Pai voted "no" Thursday, an FCC source said. Commissioner Mignon Clyburn's office didn't comment.
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Added to Chairman Tom Wheeler's approval that came when the draft order was put in circulation (see 1604250039), that three-person majority backing triggers the must-vote rules setting a deadline of about two weeks in which commissioners have to vote yea or nay, though that deadline can be extended a week, the agency official said. Charter and the FCC didn't comment. In a statement, Pai's office said the agency's merger review process "is badly broken." "It’s about imposing conditions that have nothing to do with the merits of this transaction," Pai's office said. "It’s about the government micromanaging the internet economy.”
Lobbying aimed at modifying the draft conditions is ramping up, as was expected (see 1604260046). While New Charter has majority approval it needs, that must-vote deadline still leaves time for further lobbying on conditions and the possibility of edits to the conditions, the FCC official told us.
Any condition requiring New Charter to overbuild its broadband footprint to overlap with another provider should be tailored to focus on markets "where additional entry is most needed," such as those where prices exceed those offered in urban areas, and service falls short of FCC speed, latency and packet loss benchmarks, the American Cable Association told Mignon Clyburn Chief of Staff David Grossman in a meeting, according to an ex parte filing Thursday in docket 15-149. ACA also said the agency should limit that overbuild footprint "to only locations in areas served by larger providers" in an effort to avoid putting smaller providers out of the market due to New Charter's "significant scale advantages." Any buildout requirement should exclude any areas seeing Connect America Fund Phase II support and target areas not receiving CAF dollars, to avoid money-wasting duplication of efforts, NTCA said in an ex parte filing Wednesday on its meeting with Mike O'Rielly Chief of Staff Robin Colwell.
Charter CEO Tom Rutledge called Commissioner Ajit Pai directly to push for approval, said an ex parte filing Wednesday in the docket. Charter said Rutledge touted the deal's public interest benefits, including faster broadband service, increased network buildout and a low-income broadband offering, and said the consolidation will have no negative consumer impact. Independent programmers TV One, Uphoric TV and Dog TV all endorsed New Charter in filings (see here and here), saying Charter has a demonstrable pro-indie and diverse programming track record.
National Hispanic Media Coalition, also meeting with Grossman, said it opposes New Charter, but any approval should be predicated on the condition the company take part in the Lifeline program as a way of insulating low-income subscribers from likely broadband price increases, and requiring that Lifeline-eligible consumers qualify for Charter's proposed low-income broadband offering, it said in a filing Wednesday. The group also said New Charter should be urged to commit voluntarily to carrying independent and diverse programming.