A federal judge approved the merger of Time Warner and AT&T this week, opening the floodgates for even more large mega corporate mergers. Comcast moved almost instantly to provide a massive bid on 21st Century Fox, outbidding Disney by over 15%, setting off a huge bidding war. Leo says that the judge got it wrong and this represents a serious problem for consumers, even though customers like it because it saves them money in the short run.
AT&T is buying Time Warner for $85 billion. Time Warner includes HBO, CNN, TBS, TNT, Warner Bros, and more. The reason these carriers, AT&T, Verizon, Comcast, etc are buying media companies is because they don't want to be in the business of being a 'dumb pipe' for internet access. They want to be in the content business. It's expected that the deal will get regulatory approval without issue.
Don is a Verizon customer and they just got bought by Frontier communications and now his FIOS internet speed has been cut in half, which is worse than dial up. What can he do? Leo says that Time Warner cable is probably his best bet for broadband. They just got bought by Charter Communications, though. Cable is usually better than DSL, but it also depends on how it is in his area. As for phone service, he can just keep it or simply cancel it. He should make sure he gets a DOCSIS III modem if he goes with cable, though.
Jeremy switched carriers to Time Warner and now his wireless printer doesn't work right. It'll print fine and then later, the connection drops and he has to re-enter it. Leo says the latest drivers from the printer manufacturer should fix it. He had that issue and updating the drivers from the manufacturer fixed it.
Leo says he does need to get a modem that's compatible, and he can get a list of compatible modems from Time Warner's website. Leo uses an Arris modem on Comcast, and he thinks that would also be compatible on Time Warner. Leo says you can almost always save money and get a more up to date modem by buying your own instead of renting one from the cable company.
Lee now has 100Mbps through Time Warner Cable and he's excited. Leo says that's in direct response to Google wiring up communities with Gigabit internet access. Time Warner calls it "GigaPower." But when Lee connects with his Apple devices, they can't keep up with it.
This week marked the huge news that both CBS and HBO have announced stand alone streaming services without the need of a companion cable subscription. CBS's All Access starts now, while HBO's service will come out in 2015. Leo says cord cutters just want to watch Game of Thrones without having to have a cable subscription. But Leo also says he'll believe it when he sees it. If it happens, though, that will be a huge development.
Jim wants to buy his own modem and send back his Time Warner modem. But they say he has to keep it because of his telephone service. Leo says that may be true, since cable phone service uses VoiceOver IP and the cable modem box may require it. So if he is going to use his own modem for internet, then he'll need a splitter to divide the internet traffic. And that's why Leo hates cable monopolies. His only choice is his cable company. He'll get about 1-2 Mbps with Netflix at best. And that likely means a downgraded quality of Netflix.
AT&T is expected to announce this week that they will be buying DirecTV. Leo says that with Time Warner being bought by Comcast after buying Universal, the landscape is getting smaller, and will leave little room for competition. This is not a good thing for consumers.
AT&T makes bet on video with $48.5 billion DirecTV bid (Reuters)…
Scott thinks it's a really bad idea to let Comcast get control of Time Warner. It's already a monopoly in local markets with cable service, but if they get Time Warner, they'll also control the Internet. Scott says that Comcast would be servicing one out of three homes in the US and that's way too much power. Leo says there's plenty of evidence of anticompetitive behavior on the part of Comcast. Scott agrees and says that the merger just might go through since rulings have come down to allow media companies to own more and more.