DoJ to Review AT&T-Comcast Merger

Federal Trade Commission Chairman Tim Muris moves case to Department of Justice. The DoJ confirms that its review of the merger has begun. Advocacy groups claim that the new DoJ has a history of being kinder to monopolies than the FTC.

by Roy Mark of www.internetnews.com [February 25, 2002]

The Department of Justice has begun a review of the AT&T-Comcast merger, precluding Federal Trade Commission (FTC) involvement in the proposed $72 billion deal that would create the nation's largest broadband provider with 22 million subscribers in eight of the nation's 10 largest markets. Under the Byzantine federal rules of merger approvals, either the FTC or the Department of Justice, but not both, review pending deals.

An FTC spokesman said the agency would neither confirm nor deny that FTC Chairman Timothy J. Muris had decided to let Justice handle the review but FTC Commissioner Mozelle W. Thompson told InternetNews.com, "It's true, the Department of Justice will handle this review."

Department of Justice spokeswoman Gina Talamona also confirmed that DoJ has begun the review.

Consumer advocates had favored an FTC review of the proposed merger that would create the nation's largest cable company, citing the agency's past experience in the AOL-Time Warner merger and voicing concerns that the Department of Justice is less bipartisan and less independent than the FTC.

"I'm disappointed with Chairman Muris' decision," Thompson said. "With our prior experience with open access issues, I felt we were well qualified to review the merger. Apparently, Chairman Muris felt otherwise."

Numerous groups, from ISPs to public advocacy groups opposed the AOL-Time Warner merger, warning that the deal would harm competing Internet service providers by blocking them from lucrative markets through a monopoly on the Internet's high-speed infrastructure. The FTC eventually required AOL-Time Warner to make its cable lines open to competing services.

These groups fear that the Department of Justice will not require a merged AT&T Cable-Comcast meet the same requirements.

Jeffrey Chester, executive director of the Center for Digital Democracy, said, "The FTC is especially expert in media mergers involving new digital networks, as it demonstrated in the AOL TW review."

Chester added that the merger review will now be in the hands of a "politically appointed official who has shown, in the Microsoft case, that DOJ is unwilling to develop serious policy approaches to ensure open and competitive digital markets."

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