Copyright 2001 The Denver Post Corporation  
The Denver Post
July 10, 2001 Tuesday 1ST EDITION
SECTION: BUSINESS; Pg. C-03

LENGTH: 638 words

HEADLINE: Deal critics: Consumers would pay more, get less

BYLINE: By Louis Aguilar, Denver Post Business Writer,

BODY:
Comcast Corp.'s bid for AT&T Broadband is the kind of highly  concentrated, blockbuster media deal that a growing chorus of  critics decry as unhealthy for consumers.

If the $ 58 billion deal is ever sealed - and it's a long way  from that point - Philadelphia-based Comcast would have access to  22 million of the nation's 100 million households via cable TV and  high-speed Internet access. That would make it the biggest in an  age of giant cable companies.

Comcast is the nation's third-largest cable company with 8.5  million subscribers. After the merger, it would have 10 million  more customers than AOL Time Warner - the second-largest owner of  cable systems.

'Consumer rates will go up and     your choices will likely  narrow. This is actually a case of a monopoly trying to overtake a  monopoly,' said Ben Bagdikian, media critic, former dean of the  graduate school at the University of California-Berkeley and  author of 'The Media Monopoly.'

'Monopolies use their position to get more than a reasonable  return from the market,' he said. 'Think about your cable bill.  You have probably heard promises by your local cable provider to  lower rates. Yet, I'm willing to bet, your cable bill keeps going  up. What choice do you have to switch?'

In the past decade, a few of the country's largest industrial  corporations have acquired more public communications power than  any private businesses have ever possessed, Bagdikian said.

Giant media companies have tremendous power over what type of  information consumers get to watch and receive. They're aided by  the digital revolution and the acquisition of subsidiaries that  operate at every step in the mass-communications process - from  the creation of content to its delivery into the home.

In addition to acquiring AT&T's cable systems, Comcast said  it also was prepared to buy AT&T's sizable interests in two rival  cable operators: a 30 percent interest in Cablevision Systems  Corp. and a 25.5 percent stake in a Time Warner partnership that  owns cable systems, Home Box Office and Warner Bros. studios.

'They will be in the position to make or break television  programmers,' said Gene Kimmelman, co-director of the Washington  office of Consumers Union.

The cable industry's rapid deployment of high-speed Internet  service has made its networks a critical link between subscribers  and Internet service providers such as EarthLink Inc. and Juno  Online Services Inc.

Based on recent comments made to the Federal Communications  Commission, Comcast is not willing to share its access lines with  rival Internet service providers for free, according to the Center  for Digital Democracy, a Washington-based nonprofit group  promoting open access to the Internet.

'Comcast has made it clear that it considers Internet service  via cable to be regulated as a cable service, in essence allowing  it to have a monopoly over the wires and the range of services  consumers can access,' said Jeff Chester, the center's executive  director.

As the biggest cable provider, Comcast would have control  over key bottleneck access points, such as digital set-top boxes  and operating-system software.

'Comcast wants to become an unregulated digital toll booth,'  added Chester, 'and it will use its dominant status to extract new  fees from competitors and consumers alike.'

Then there's the content of what viewers can watch on  television.

'There may be more channels, more outlets, but the idea of  more choice of content is an illusion,' Bagdikian contends. 'You  have more choice of watching degrading television shows. Having  one media outlet provide you the cheapest forms of entertainment  is not real choice.'

LOAD-DATE: July 10, 2001