Deal or No Deal? New York State Needs to Approve Cable Merger

On Thursday, February 26, the New York State Public Service Commission will meet and possibly decide whether to approve Comcast’s $45 billion proposal to buy Time Warner cable.  The deal would combine the nation’s two largest cable companies and still needs approval from the Department of Justice and the FCC. But the state commission also needs to review if the merger is in the public interest.

New York City Councilmember Ben Kallos and Public Advocate Letitia James are leading a campaign asking the Commission to only approve the merger if Comcast commits to helping make broadband accessible to all New Yorkers.

“We’re asking for free universal broadband for New York City Housing Authority developments, we are asking for low-cost internet for low income New Yorkers, we are asking for certain infrastructure investments as well as customer service guidelines and requirements,” Kallos said.

Kallos says the Internet should be regulated as a public utility, like electricity or a phone line: and that, like the federal government’s telephone “lifeline” program, everyone should have access to the Internet.

According to the Knight Foundation, one-third of New York City families don’t have broadband Internet access. This is part of what is called the nationwide “digital divide.” The non-profit Center for Public Integrity finds that only about half of adults in the United States earning less than $30,000 a year had an in-home Internet connection, according to

At the Fred Samuel Homes in Harlem, the average median income is $18,000 per year, according to Resident Association President Diana Blackwell. She says if Comcast wants the merger approved, the company needs to help low income people here and across New York City get online.

“The educational digital divide needs to get smaller,” she said. “The children must be able to compete, and if you go below 96^th street, the children have access to the Internet. They have what it takes to compete with the rest of the world.   In this area we are lacking this. We need access.”

Comcast says they already provide options for low-income people who want broadband.

Comcast Vice President for Government Affairs Brett Perkins said during a public hearing that the company would offer low income New Yorkers Comcast’s discounted Internet service called “Internet Essentials.” The service costs $9.95 a month.

But to qualify for Internet Essentials, a customer needs to have a child in the National School Lunch Program. Also, existing customers need to cut their cable subscription for three months to qualify.

According to Comcast, 350,000 families have signed up for Internet Essentials in the company’s current area of operations, out of 2.6 million eligible families. Overall, there are 7.2 million low-income families in the company’s service area, but many don’t qualify for Internet Essentials because they don’t have children or owe the company money from previous bills.

Councilman Ben Kallos says he’s disappointed with how Comcast’s Internet Essentials program has worked since it started in 2011.

“It seem a little disingenuous,” he said. “And I’m hoping to see an expansion of [Internet Essentials,] hoping they’ll call it New York essentials and expand it from low-income families with kids in school, to anyone with low income.”

Comcast spokesperson Charlie Douglas says the company has made efforts to sign up more people. Internet Essentials was a condition of the federal government’s approval of Comcast’s purchase of NBC Universal in 2011.

“It was supposed to end in 2014,” Douglas said. “But now we are extending the program indefinitely. We fell in love with the program and couldn’t imagine not offering it.”

New York’s Public Service Commission has postponed voting on Comcast’s merger with Time Warner Cable four times. The commission is up against the federal deadline for a decision, which is expected at the end of March.