This week Comcast, which is fast becoming a monolith, purchased Time-Warner Cable. Comcast claims the deal does not reduce competition because the two companies serve different areas of the country. (In another decade, the argument was used by oil giants claiming the gas stations of purchased companies did not overlap with the buyer’s). For Comcast, Time-Warner brings with it the very important New York, Los Angeles and Dallas markets. Is not size by itself power?
We are already suffering the effects of the concentration of power: Access to the internet is the fastest with fiber-optic cable all the way to the house. In this country, only Verizon offers it. Speed governs the quality of the viewing experience. More importantly, it opens up possibilities for other entrepreneurial ideas. Thus the next Google or the next Facebook is more likely to germinate in South Korea or Sweden or elsewhere such connections are widely and cheaply available.
Fiber-optic cable is many times faster than the coaxial used by Comcast and other cable companies, which in turn is faster than AT&T’s DSL. Why is DSL slow? Because the signal suffers a traffic jam in the last few local miles using copper cable, and the local telephone company does not want to make the large investment needed to replace urban copper networks. So there we are: our system of laws, governance and regulating bodies have failed the public in the biggest step to the future.
A similar concentration of power has destroyed the independence of media. The five major corporations controlling our media these days are beholden to the government for their broadcasting licenses, and the government and Congress are increasingly falling under the sway of their corporate contributors including the banks, which caused our recent great recession by first lobbying successfully for the removal of regulations barring commercial banks from risky trading on their own account, and then with ultimate gall — lobbying for taxpayer relief under the so-called too-big-to-fail theory.
Too big to fail maybe, but never to big to be taken over by the taxpayers bailing them out and retaining the option of privatizing them later at a profit. But then ordinary taxpayers don’t have a lobby and little clout in Congress.
So whither our democracy?