Most of the time, news about two large corporations merging is never good. History has taught that the megalocorporations that result have a steady track record of firing workers, removing products from the market and yes, free-market ideologues are losing money too. Think of when Chrysler merged with Daimler-Benz or AOL’s purchase of Time-Warner; both events were messy and a loss for the companies involved.
News of Comcast’s attempt to buy Disney is going to be another sad repeat of the same story. To the delight of business writers everywhere, cable giant Comcast is offering $66 billion to buy Disney. Disney’s board of directors rejected the offer Monday. A messy bidding war by Comcast for the company is now likely. If this purchase does go through, every one of us needs to be worried.
Comcast is the nation’s largest cable provider; Disney is Disney. If purchased, the arsenal it would bring with it includes ABC television and radio, a mess of cable channels (ESPN, the History Network, E!, Fox Family Channel and about 15 more), the Anaheim Angels baseball team, the Mighty Ducks hockey team, Miramax Films, Touchstone Pictures, and yes, Mickey, Minnie, Donald and Disneyland.
Comcast would become not only America’s largest cable provider, but also a company that would live up to the worst expectations of anybody who feared the relaxing of media ownership rules. ABC will be owned by a cable company. There would be questions of whether Time-Warner would be able to broadcast channels like ESPN and the History Network which are owned by its arch-rival Comcast.
Both the Anaheim Angels and the Ducks play in towns where cable television is provided by companies other than Comcast – Southern Californians now have to face the very real question of whether they will be able to watch their favorite teams on television.
A press release sent out to announce the proposed hostile takeover boasts that “the combination would create one of the world’s leading entertainment and communications companies with an unparalleled distribution platform and an extraordinary portfolio of content assets. The new company would have a presence in all of the nation’s top 25 markets, and would propel broadband forward, expanding current services and inspiring new ones.”
The non-corporate translation of that paragraph just wants to let you know that Comcast will own a huge mess of cable channels and other entertainment companies they are going to guard fiercely. But not only that, they will use that to expand their cable Internet business for all it’s worth and use Disney mainly as a promotional tool.
A repeat of the 19th century’s robber baron years is the last thing we need. Mergers and purchases led to companies that inevitably tried to bend the law to their own purposes, raise prices and generally screw anyone in their path. It’s why anti-trust lawsuits were born and it is where we might be going if we are not careful.
Comcast-Disney by its very nature would be different than AOL-Time Warner or Rupert Murdoch’s monolithic News Corp. Disney is a company that has recently fallen on hard times – their recent loss of Pixar Studios, the Toy Story people, is proof of that.
Comcast’s purchase of AT&T Broadband two years ago made them one of the largest Internet companies in the country and have shown no signs of slowing down their quest of expansion. Their merger would prove to have serious consequences on everything from freedom of speech on the airwaves to the loss of thousands of jobs. Whatever happens, we can be sure it won’t be good.
Neal Ungerleider can be reached at N_Terminal@yahoo.com.