[Congressional Record Volume 156, Number 169 (Saturday, December 18, 2010)]
[Senate]
[Pages S10690-S10692]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 NET NEUTRALITY AND COMCAST/NBC MERGER

  Mr. FRANKEN. Mr. President, I rise today to talk about the growing 
threat of corporate control on the flow of information in this country.
  Today we have been debating incredibly important issues, and I don't 
mean to detract from any of them. We need to be doing everything we can 
to protect our national security and to reduce the threat from nuclear 
weapons. But while we debate these issues in front of the public, 
behind the scenes, away from public scrutiny, the Federal 
Communications Commission is about to decide two distinct but very 
closely related issues that have the potential to change dramatically 
the way we get our entertainment, the way we communicate with one 
another, and, most importantly, the way we use the Internet.
  The first matter before the FCC is the proposed merger of Comcast and 
NBC/Universal. There is no question in my mind that regardless of what 
you hear from industry, this merger will be bad for consumers on many 
levels. It will allow Comcast to exploit NBC/Universal's content, 
charging other cable networks more for access to NBC shows and movies. 
Do you know what that will do? It will raise your cable bills. And NBC/
Universal--which actually owns 37 broadcast or cable networks--will be 
favored by Comcast to the exclusion of other independent or competing 
networks. This means Comcast will pay less to carry channels such as 
the Discovery Network, the Food Channel, Bloomberg, or the Tennis 
Channel--threatening their financial viability--or these channels will 
be relegated to the graveyard around channel 690 or 691 or 692, or 
customers will have to pay even more each month to buy access to these 
channels.
  This is bad for consumers because it is going to put many of these 
networks out of business. That means less choice and more Comcast/NBC 
programming.
  But it doesn't end there. Comcast also happens to be the Nation's 
leading wireline broadband Internet provider, which means this single 
company will both own the programming and run the pipes that bring us 
that programming. Here again, Comcast will be able to use its 
overwhelming market share--and in many markets its near monopoly in the 
Internet business--to favor its own video services, say, its OnDemand 
service, over companies such as Netflix, that are cheaper and would 
otherwise win on a level playing field.
  These are all major problems with the deal. But it might be tough to 
understand in the abstract how this deal will affect you, so let me 
take a minute or two to make this more concrete.
  I ask the people sitting in the gallery, the Senate staff watching 
this speech, and everyone at home in Minnesota: How many of you like 
your cable and Internet provider?
  When you call Comcast or Verizon or AT&T about a problem, how many of 
you get good service? How many of you like the prices you pay?
  When you decide you want to sign up for broadband, and Comcast tells 
you that they aren't sure when they can come to install your service, 
and then finally you get an appointment and you have to take a day off 
from work to wait between 9 a.m. and 2 p.m. for a repairman to come, 
and then he doesn't come, is that how you feel you deserve to be 
treated?
  Are you getting good service when you call Verizon and spend 10 
minutes listening to automated messages and pressing numbers that 
direct you to more automated messages, and then finally--finally--you 
get a human being on the line but that person tells you that he or she 
can't help you and you get put on hold again; is that how you deserve 
to be treated? Are you getting good service?
  When you have had enough with bad service and rapidly rising bills 
and you decide you want to switch to another company, how many of you 
have found that you don't have another choice? That there is no other 
cable provider in your area?
  I can tell you that right now, Comcast has about 23 million cable 
subscribers and about 16 million Internet subscribers. They are already 
the largest provider of cable service to Americans by a very large 
margin, and in some areas, they have a total monopoly.
  And this is what cable and Internet customer service is like today. 
Do you think that merging the single largest cable provider, which is 
also the largest wireline Internet provider, with one of the biggest TV 
and movie studios in the country, will make any of this better? Do you 
think it will lead to lower prices on your cable and Internet bills? Do 
you think it will mean more choice for what you can watch and download 
at home? Do you think it will mean better customer service?
  I can assure you that the answer to these questions is no, no, no, 
and no.
  We count on competition in this country to keep corporations in 
check, and we have designed antitrust laws to ensure that companies are 
not getting too big or too powerful. These laws were designed to 
protect consumers, because the one thing we know about corporations is 
that they are created to maximize shareholder profit--not to protect 
consumers.
  There is nothing wrong with that. We want corporations to grow, and 
create jobs, and provide goods and services. There are some great 
corporations based in Minnesota, like General Mills and 3M. In addition 
to providing you Cheerios and Post-it notes, these companies put a lot 
of Minnesotans to work.
  But when you go shopping for cereal, you have a lot of choice. 
General Mills may produce Cheerios, but they have to compete with 
companies such as Kellogg's, which makes Corn Flakes, and Post, which 
makes Fruity Pebbles. And they all have to compete with the store or 
value brands.
  Let's look at another example of the benefits of competition. When 
you go out for dinner at a restaurant, you usually have a lot of 
options. I am guessing you don't go back to the restaurant that served 
you limp lettuce, mediocre meatloaf, and cold, lumpy mashed potatoes. 
And I am guessing you wouldn't go back if they told you that you would 
be served sometime between 9 a.m. and 2 p.m.
  Unfortunately, you don't always have that kind of choice when it 
comes to your cable and Internet service. And this is only going to get 
worse if the FCC allows the merger between Comcast and NBC to sail 
through. It is competition--and regulation where there isn't 
competition--that keeps corporations accountable to consumers.
  But don't take my word for it. You can already see what Comcast has 
up its sleeve. If the merger is allowed to go through, as I mentioned 
before, we can expect Comcast to favor its own content and leave 
consumers with less choice.
  Take the Tennis Channel, which filed a complaint against Comcast 
earlier

[[Page S10691]]

this year. It alleged that Comcast has been favoring the Golf Channel 
and its own sports channel, Versus, by making those channels available 
as part of its basic cable package, while putting the Tennis Channel on 
a so-called ``premium tier.'' In other words, if you get cable from 
Comcast, you get the Golf Channel and Versus for free, but if you want 
to watch the Australian Open on the Tennis Channel, you need to pay 
another $5 to $8 per month.
  Yet, Comcast pays the Tennis Channel only a fraction of what it pays 
itself to carry the Golf Channel or Versus, which are much less 
popular.
  I fear this is a sign of things to come. As media conglomerates get 
bigger and bigger, they have every incentive to make their own content 
easier and cheaper to access than everyone else's content.
  Now, I have been talking to a lot of people about the possible impact 
of this merger, and do you know what I keep hearing? Do you know what 
small businesses and cable programmers are telling me? They are coming 
to my office discreetly, and they are saying that they oppose this 
merger--but they can't speak out because they are worried about 
retaliation from Comcast. And to me, that is the definition of a 
company with too much market share.
  Comcast has put out the word that this merger is a fait accompli. 
They have announced a slate of 43 officers for NBC, despite promising 
to refrain from doing so until the review of the merger is complete.
  So it is no surprise that small--and some not so small--cable 
networks see the writing on the wall and are not willing to take the 
chance of opposing this deal publicly, again, for fear of retaliation 
by Comcast.
  And they are probably right. If this deal goes through, Comcast will 
have the power to put them out of business. If you knew that, would you 
stand up and complain to the FCC about Comcast? Probably not.
  This type of anticompetitive conduct is exactly why we need the 
Department of Justice and the FCC to stop this merger.
  And this merger is only the first domino in a cascade that is sure to 
come. Make no mistake, if this merger is approved, if this deal goes 
through, it will be only a year or 2 before we see AT&T trying to buy 
ABC/Disney, or Verizon trying to buy CBS/Viacom. And you know what 
these companies will say? ``You let Comcast and NBC do it, now it is 
our turn.'' And what will the FCC or the Department of Justice say 
then?
  Now is the time to decide whether we want four or five companies 
owning and delivering all content. Imagine a world with no independent 
voices, and no competition.
  But now let me go back specifically to Comcast. Not just its cable 
profile. Let's talk about Comcast's control of the Internet. There is 
no better example of how Comcast plans to use its virtual monopoly than 
what we have seen in the last few weeks with its treatment of Netflix.
  I think we can all agree that Netflix has changed the way many 
Americans watch movies, and it all started because one of its founders 
was sick of paying late fees for movie rentals. This company is one of 
our Nation's great success stories--it now has almost 17 million 
subscribers and generates hundreds of millions of dollars in revenue--
and it all happened in just over a decade. But most importantly, it 
offered an alternative and less expensive option for consumers to watch 
movies.
  Netflix now has a lot of money and can write big checks to buy movies 
and video content, so I didn't think I needed to worry about them. But 
then I heard that being the highest bidder for content may not be 
enough.
  As it turns out, cable companies are worried about Netflix's success. 
It represents the first real competition they have seen in a long time, 
and they want to shut Netflix down. How can they do that? By cutting 
off Netflix's access to the things people want to watch. And when is 
this most problematic? First, it is when Netflix's competitors--like 
Comcast or Time Warner Cable--also own the programming that Netflix 
carries. Second, it is when Netflix's competitors are also the ones 
that sell--and control--access to the Internet.
  Neither of these are theoretical. Just last week, Time Warner's CEO 
brazenly stated that Netflix's deals with Time Warner may not be 
renewed. Other studio executives are saying the same thing.
  And what I am hearing is that Comcast, which is not yet even in 
control of NBC, plans to reverse course and ultimately pull NBC/
Universal's programming from Netflix.
  Comcast also recently announced that they are imposing a new fee on 
Level 3 Communications, the company slated to become the primary 
delivery mechanism and backbone for Netflix's online streaming movies 
and TV shows. Coincidentally, Netflix is one of Comcast's main 
competitors for video delivery, which makes this price hike seem just a 
little fishy to me.
  Regardless of Comcast's motives for charging Level 3, this is a clear 
warning sign of what we can all expect if this deal goes through.
  If this deal goes through, Comcast will make it harder and more 
expensive for you to watch movies online through any service other than 
its own. If this deal goes through, Comcast will have the power to 
limit your choices to watching Comcast-owned content over Comcast's 
services, like its video OnDemand service.
  I use the phrase ``if this deal goes through'' because this is 
exactly the sort of anticompetitive behavior that the Department of 
Justice and the FCC are supposed to stop.
  What is even more ludicrous is that this is happening when Comcast 
and NBC should be on their best behavior. Right now, they are under 
close scrutiny by two Federal agencies, the FCC and the DOJ. Yet they 
seem to be making even more bold-faced power grabs without any concern 
about government oversight.
  But in addition to the Comcast-NBC merger, what is also before the 
FCC is a new set of proposed rules that will make it easier for large 
media conglomerates--like Comcast--to do nothing short of controlling 
the Internet. The chairman of the FCC is calling this a ``net 
neutrality'' proposal. But let's be clear. This is not real net 
neutrality.
  I believe this is one of the most serious issues facing our country 
today. Let me take a step back and explain what net neutrality is. Put 
simply, it is the idea that big corporations shouldn't be able to 
decide who wins or loses on the Internet. It is the idea that the 
Internet should be a level playing field for everyone, from a blogger 
to a media conglomerate, from a small businessperson to a powerful 
corporation. I believe that net neutrality is the free speech issue of 
our time.
  The Internet wasn't created by corporations. It was created using 
taxpayer dollars, and it has dramatically altered our daily lives in 
more ways than any of us could have ever dreamed. It is an incredible 
source of innovation, a hotbed for creativity, and an unbelievable 
producer of wealth and jobs in this Nation. It was instrumental in 
putting President Obama in office--but it was also equally instrumental 
in helping the Tea Party become a powerful force in American politics.
  I may not agree with everything the Tea Party movement has done, or 
everything it stands for, but I do firmly believe that the Tea Party 
has a right to organize and to post its views on the Internet.
  Strong net neutrality principles would ensure that everyone--from the 
most liberal blogger on Daily Kos--to the most conservative fan of Fox 
News--would continue to have an equal right of access and an equal 
ability to communicate with like-minded people.
  If corporations are allowed to control the Internet, all of that 
would change. The Internet has become the public square of the 21st 
century. This is why Tea Party activists and anyone who cares about 
personal liberties and freedoms should care about net neutrality.
  One popular Minnesota blogger should be able to get his or her 
information to you as quickly as MSNBC. Or to say it another way, MSNBC 
shouldn't be able to pay millions to get their Web site to load faster 
on your computer. We do not want corporations to be able to drown out 
the voices of smaller, less powerful individuals.
  Unfortunately, the proposal before the FCC--which I will admit I 
haven't seen because it has not been made public--would reportedly 
allow companies

[[Page S10692]]

to do just that. It would allow Internet providers to create a fast 
lane for companies that can afford to pay a premium. It would allow 
mobile networks, like AT&T and Verizon Wireless, to completely block 
content and applications whenever it suits them--for either political 
or business reasons.
  Let me underscore this--this is the first time the FCC has allowed 
discrimination on the Internet.
  Let me give you an example. Maybe you like Google Maps. Well, tough. 
If the FCC passes this weak rule, Verizon will be able to cutoff access 
to the Google Maps app on your phone and force you to use their own 
mapping program, Verizon Navigator, even if it is not as good, even if 
they charge money, when Google Maps is free.
  If corporations are allowed to prioritize content on the Internet, or 
they are allowed to block applications you access on your iPhone, there 
is nothing to prevent those same corporations from censoring political 
speech.
  The Obama campaign used a mobile app to help organize volunteers. And 
now there are a bunch of Tea Party apps you can download. But maybe not 
for long. Not if your wireless carrier doesn't want you to get them. 
And that is something every American should care very deeply about.
  I am here on the floor today because I think Americans need to 
understand just how critical net neutrality really is.
  This is complicated stuff. But it directly affects all of us.
  And it is not just about speech, it is also about entrepreneurship 
and innovation. It is about our economy.
  There is no question in my mind that without significant changes, the 
proposal currently pending before the FCC would be bad for our economy.
  Think about companies like YouTube, which started in a tiny office 
above a pizzeria, and grew to be worth billions of dollars. At the 
time, Google had a competing product, Google Video, which was then the 
standard but was widely seen as inferior. Had Google been able to pay 
Comcast large amounts of money to make its website faster than 
YouTube's, YouTube would be nowhere. Fortunately, Google could not pay 
for priority access, and the rest is history.
  Think about Facebook. Once upon a time, it was a small startup. 
Remember Friendster or MySpace? They were once the dominant social 
networking sites before Facebook won over users with a vastly superior 
product. But that might have never happened if Friendster or MySpace 
had paid lots of money to reach users faster. If Facebook had taken a 
significantly longer time to load on your computer, it never would have 
succeeded.
  These are just some examples of how today's free and open Internet 
has fostered innovation, which has created jobs, and has spurred 
competition, which has benefited all consumers. Now think of the next 
Facebook or the next YouTube or the next Amazon. The only way to 
guarantee that innovation will continue is to have strong net 
neutrality rules that will protect and maintain today's free and open 
Internet.
  So the FCC has to make two big decisions, one on the Comcast-NBC 
merger, and one on net neutrality. These decisions will impact every 
American for years to come.
  You may not know this, but the FCC is an independent agency. 
Independent agencies are nonpartisan. They are not beholden to Congress 
or to the President, and they certainly should not be beholden to the 
industries they regulate. That is why I am concerned when I hear that 
the Chairman of the FCC is calling the CEOs of companies they are 
supposed to be regulating, seeking their public endorsement of his net 
neutrality proposal.
  Independent agencies are charged with acting in the public interest. 
So when I hear that the FCC is considering a net neutrality proposal 
that is supported by the largest media corporations in America, I am 
suspicious, and you should be too. The FCC should not be worrying about 
getting the sign-off from the very corporations that it is supposed to 
be regulating, period.
  The FCC has made public its plans to act on its flawed net neutrality 
proposal this coming Tuesday. I sincerely hope that the FCC will make 
significant improvements before then, and that each of the 
Commissioners will think long and hard before they vote to approve a 
proposal that could actually make things worse for all Americans.
  I have also heard that the FCC is going to be acting very soon on the 
NBC-Comcast merger, and it needs to do this in the light of day, not 
hidden in the middle of Christmas and New Year's. The American people 
have a right to know about this merger. I will be supremely 
disappointed if approval of the merger is slipped through when most of 
America is unwrapping presents and spending time with their families, 
not worrying about their cable or Internet bills.
  We are at a pivotal moment and we need to stop the cascade of dominos 
that will forever change how we pay for TV and browse the Internet. But 
it is not too late. The government has a role to play here, and I hope 
the FCC will step up, be brave, and do what is right for the American 
people.
  I yield the floor.

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