Let's Urge Congress to Break Up Big Cable



Let's Call on Congress to Break Up the Cable Monopoly

Special Guest Post, by CJB

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Please Break Up the Cable and Studios Monopoly


In 1949 The United States Supreme Court ruled against Paramount in Paramount vs United States. Paramount had been found guilty of having a monopoly under the Sherman Act of 1890.



Background of The Sherman Act:


The Sherman Anti-Trust act of 1890 was created in order to prevent businesses from being 'anti-competitive'. The act was written by Senator John Sherman (R-OH). Senator George Frisbie Hoar who co-authored the Bill stated: "... [a person] who merely by superior skill and intelligence...got the whole business because nobody could do it as well as he could was not a monopolist..(but was if) it involved something like the use of means which made it impossible for other persons to engage in fair competition." This rules out the cable companies.

Cable companies have a standard practice that a community they enter into has a 'no competition clause' that the community must sign making it impossible for another cable service to come into their community to compete. Although some services, such as Dish and Direct TV can come in and provide similar cable style services, they cannot provide internet services. This places a significant advantage with cable in the Internet market.

Cable has a long history of what could easy be considered unfair business practices with both it's customers as well as anything they see as a viable threat to their business. The concept of 'cord cutting' has been a growing popularity in the United States. This is where individuals get the majority of their TV viewing from devices like Roku, Apple TV, Amazon Fire and even Smart TV's and Bluray players provides some of the best sources for “Cord Cutting” available with Netflix and Hulu.

The relationship between Netflix and Cable/Internet providers has always been a sticky one with reported incidents of internet speeds from Netflix servers being reduced so badly, that video could not be streamed.

 Cable companies still continue to limit the availability of Netflix by charging more fees to those who are more likely to utilize their services in the form of Data Caps. Cable companies limit data caps to the 250 – 350 GB range, and it was no accident that this was the range picked. The problem is that this goes on the theory that data caps are to ensure that data is available for all of it's customers, but the truth is that it's less about the data then it is about the speeds that are required for streaming videos.

This is hardly unique of 'cable companies'. Cable companies have very well established historical roots in the Motion Picture industry, an industry that has already been found guilty of monopolistic business practices during the middle of the 20th century.

 The landmark 'Paramount vs United States” found that the typical business practice of the motion picture industry owning the theaters during the movie golden age made was in violation of the Sherman Anti-trust act of 1890.

 This is not much different than what we have today with cable companies. Here is a quick look at the relationships between Cable and the movie studios and why this monopolist business practices are so similar to the those found illegal by the Supreme court in the mid 20th Century.

 The main focus of the court case was that it used a 'vertical integration' model which is remarkably similar to what is currently going on right now within the Cable and television industry.

For example, during the 1970's there was a considerable amount of exchanging of TV programs between the network TV stations and the movie studios that produced them. Universal, for example, produced some very popular programs that aired on ABC (Six Million Dollar Man) Kojak (CBS) but as we enter into the 21st Century Universal primarily makes TV shows for NBC or Syfy, which are all owned by Comcast.

The same is true with Disney. During the 80's and 90's several TV programs were produced for NBC and CBS or placed into first run syndication, a relatively seldom but not completely uncommon practice dating back to the dawn of TV during the 50's. However during the late 90's to now, the vast majority of the TV shows produced by Disney are currently aired on ABC (which it owns) or several different cable channels it owns, most notably the Disney channel.

The same holds true with Warner Brothers with a significant amount of the programs that they produce being aired on CBS or CW (with CBS and Warner Brothers Studios being co-owners of CW). Even many of the programs that are being aired on CW are based upon DC Comics heroes such as 'The Flash', 'Arrow' 'I, Zombie' and 'Legends of Tomorrow' along with the new 'Super Girl' TV show on CBS, all owned by Warner Brothers. Other big hits on CBS includes 'Big Bang Theory' produced by Warner Brothers.

 It is obvious that they are using the same business model that was caused the lawsuit during the mid 20th century that brought about the anti-trust lawsuit.

 Comcast is not just limited to owning Syfy or NBC, but owns some of the most popular cable channels on any cable provider. Channels like USA, Syfy, Chiller, Clu, E! Entertainment, Bravo, Oxygen and Sprout are several of the most popular Cable channels available all owned by Comcast, the largest cable provider in the United States.


Comcast Isn't Alone In This Exclusive Club


ABC, the network that is owned by Disney which has grown to monumental proportions in the past 30 years is also a significant player in the Cable monopoly that copies the mid 20th Century. 

 Some of the cable channels owned by Disney includes: A&E, History, H2, Military History, Crime and Investigation Network, Lifetime, Lifetime Real Women, Disney Channel, Disney Jr, Disney XD and Lifetime Movie Network are all major cable networks owned by Disney, one of the largest production studios in the world.

The list goes on with Time Warner (CW/CBS) and several prominent cable networks and even AMC is owned by Cablevision.

 In closing, I respectfully ask congress to investigate the studios and cable companies for violations of the Sherman act.

References:
DSL Reports - We had to Pay Comcast Because We Were Losing Customers
Huff Post - Comcast Busted: New Tolls for Netflix Aren't All You Should Worry About
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Reach Out to Your State Representatives


Now that you know what has really been going on, please be sure to contact your local representatives by April 1, 2016 and let them know how you feel about this.

Here is How to Contact Your State Representatives: 

Click the button or use the form below to look up your State Representatives
  • First enter your Zip Code.
  • Then copy all the text between the double lines and paste it into the form. 
  • Fill in your info and click "Preview Letters".
  • In the new window click "Send Letters".
If enough people share, like and email, they will listen. 




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