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Comcast’s David Cohen Survives Night of the Long Knives Blame Game for Comcast Merger Failure

David "I'm crushing your head" Cohen

David “I’m crushing your head” Cohen

Your boss authorized $32 million on lobbying for a $45 billion dollar merger deal that just went down in flames on your watch and you were the guy the company depended on to push it through. What do you do?

If you are Comcast vice president David Cohen, you pray for a press release signed by the CEO reaffirming trust in you.

Cohen can breathe a little easier because Brian Roberts, CEO of Comcast, did exactly that.

“There is nobody better than David Cohen,” Roberts wrote. “He’s incredible at what he does and we are beyond lucky that he helps passionately lead so many areas at Comcast. He is also a huge supporter of Philadelphia and has done so much for the community. I’m extremely proud to have him on our team.”

It could have been much worse for Cohen, whose contract (and $15 million annual salary) is up at the end of this year. He’s the fourth biggest earner at Comcast, but his stunning arrogance before Congress and the public may have helped nail the coffin shut on a merger worth tens of billions.

Some media outlets have called Cohen myopic, unable to see the building torrent of opposition from consumers, public interest groups, and even regulators.

The NY Post:

“They just lost a big battle. Does the company need a new general to supervise the Washington political strategy?” asked one source.

Comcast is already on the hunt for a new chief financial officer, with Michael Angelakis walking away to begin his own Comcast-backed private-equity fund before the deal imploded.

comcast twcComcast’s claims of “deal benefits” for consumers was perceived to be tissue-thin by legislators like Rep. Tony Cárdenas (D-Calif.), whose district would have seen Time Warner and Charter customers absorbed into the Comcast Dominion.

“[Cohen] was smothering us with attention but he was not answering our questions,” Cárdenas told The New York Times, adding in the early stages of the deal he was open to supporting it if his questions were addressed satisfactorily. “And I could not help but think that this is a $140 billion company with 130 lobbyists — and they are using all of that to the best of their ability to get us to go along.”

Comcast’s swaggering arrogance, condescending editorials, and dismissive attitude towards consumers questioning the deal rubbed a lot of lawmakers the wrong way.

Not only did Comcast offend lawmakers, but their all-important staffers as well. Staffers told the newspaper they felt Comcast was so convinced in the early stages that the deal would be approved that it was dismissing concerns about the transaction, or simply taking the conversation in a different direction when asked about them.

Elected officials associating themselves with Comcast, whose customer service on a good day is considered miserable, was also considered political poison. Few lawmakers were willing to publicly support foisting Comcast on their constituents. Local lawmakers in Time Warner Cable service areas who had no direct experience with Comcast customer service’s special touch of hell often did offer support, especially when a handsome check was sent weeks earlier. But voters with relatives or friends who loathed Comcast (practically everyone in America) were never fooled.

hurricane comcast“They talked a lot about the benefits, and how much they were going to invest in Time Warner Cable and improve the service it provided,” said one senior Senate staff aide, who spoke on the condition of anonymity because he was not authorized to speak publicly. “But every time you talked about industry consolidation and the incentive they would have to leverage their market power to hurt competition, they gave us unsatisfactory answers.”

Politicians asked to publicly support the deal characterized their sentiment as “leery” in polite company.

Rep. Maxine Waters (D-Calif.) was unwilling to victimize her constituents by replacing two bad cable companies – Time Warner Cable and Charter with one horrible alternative – Comcast.

“No amount of public-interest commitments to diversity would remedy the consumer harm a merged Comcast-Time Warner would have caused to millions of Americans across the country,” Ms. Waters said.

Other lawmakers who already understood Comcast as the Hurricane Katrina of cable companies got into storm shelters early.

“There are limits as to how effective even the best advocate can be with a losing case,” said Senator Richard Blumenthal, Democrat of Connecticut, who was critical of the deal from the start, “as this merger would have further enhanced this company’s incentive, its means and its history of abuse of market power.”

Comcast even cynically attempted to color and race match lobbyists with legislators, believing the shared ethnic heritage would be an added incentive.

The New York Times:

Comcast, for example, assigned Juan Otero, a former Department of Homeland Security official who serves on the board of the Congressional Hispanic Caucus Institute and now works as a Comcast lobbyist, to be the point person to work with Mr. Cárdenas.

Meanwhile, Jennifer Stewart, an African-American lobbyist on the Congressional Black Caucus Institute board, was assigned to work with Marc Veasey, Democrat of Texas, who is also black. She personally appealed to Mr. Veasey’s staff, urging that he not sign a letter last August questioning the deal, according to an email obtained by The New York Times, citing the company’s work on behalf of the minority community. (Mr. Veasey still signed a related letter.)

Comcast also asked Jordan Goldstein, a former official at the Federal Communications Commission who is now a Comcast regulatory affairs executive, to work with Mr. Blumenthal’s office. Mr. Goldstein had previously developed a working relationship with Joel Kelsey, a legislative assistant in charge of reviewing the matter for the senator, who is a member of the Senate Commerce Committee.

Disappearing Promotion/Retention Deals from Time Warner Cable; Watch Your Cable Bill

shellYou negotiated for a better rate from Time Warner Cable and thought you were all set for another year or two, only to discover the promotion ended early or never got applied at all.

You are not alone.

We did some negotiating of our own back in February and thought we managed an agreement to cut our bill from $175 to $112 — a savings of $63 a month. Instead, the first bill under the new rate was $150.

timewarner twc“You’d be surprised how many people never bother to pursue reneged on promotions like this,” said Sam Tremblay, a telecommunications bill analyst for a major regional supermarket chain.

Tremblay analyzes his employer’s telephone, broadband, and wireless bills that total close to $100,000 a month. He says he saved his employer over $50,000 in 2014 finding billing errors and getting companies to deliver on the rate promises made by salespeople.

“What a salesperson or customer service representative promises and what is actually compatible with their billing system are often two different things,” Tremblay tells us. “You are most at risk of billing errors when making changes to your account, especially if those changes involve a billing credit or special discount.”

Did you get what you were promised? (Image: Bruce Kushnick)

Did you get what you were promised? (Image: Bruce Kushnick)

He explains that many billing systems are not tied directly to call center employees offering promotions or, in our case, customer retention offers. If an employee attempts to apply a promotion the customer was not entitled to receive, or one that had expired by the time it was processed by the billing system, it is typically rejected.

The latter is what happened to us, despite initially seeing the promotion applied.

Time Warner Cable often generates a temporary “virtual” mid-cycle bill available for review online when significant changes are made to your account. We were able to see the promotion correctly applied to this temporary “bill” but it was gone by the time the official bill was mailed. By the time we noticed it, a second inaccurate bill was ready to be processed.

Other customers have found their promotions canceled or unfulfilled, especially when the offer involved a high value gift card, tablet, or other electronics. As we reported earlier, fighting for a rebate card or tablet is often a waste of time. It is typically better to request a bill credit equal to the value of the gift card or promotional item because Time Warner relies on a third-party to fulfill those offers and getting an exception made to a rebate/offer rejection is extremely time-consuming and often fruitless. Use the savings from a substantial bill credit to buy your own tablet.

“A lot of customers just don’t bother to pursue things like this, believing they were bait and switched by customer service, have no recourse, and chalk it up as another reason to hate the cable company,” said Tremblay.

Not us. We pursued the mysterious disappearing promotion with Time Warner’s social media team who forwarded the complaint to the nearest regional office and we received a call early this morning with an apology.

It turned out Tremblay had figured out the problem before Time Warner Cable.

The retention promotion we were offered on Feb. 27 expired Feb. 28 — a Saturday. By the time the account changes were processed by Time Warner’s billing system the following Monday, the promised promotion could no longer be applied, hence a $150 bill instead of $112.

To resurrect the promised promotion, the Time Warner representative placed us on the next best valid promotion — $130 a month, and before we could complain about the $18 difference, also offered a $275 credit making up for overpayments already made and ensuring the two offers are financially equal.

Tremblay said such errors are usually unintentional, especially when there is lag time between the first customer contact and the date a company’s systems are updated with the changes.

“If a company’s call center or customer-facing system is not directly tied with the billing system, it is easy to apply a credit or promotion the customer isn’t entitled to receive based on the rules programmed into the billing system,” Tremblay said. “Once the change is received by the billing system, it rejects it.”

He added the mistake Time Warner Cable made was not following up after the promotion was rejected, correcting it before an unexpected higher bill was generated.

“A customer should not have to call a second time to get a provider to live up to its original commitment, but it happens all the time,”  he said. “In my experience, 80% of billing errors are in their favor, 20% in ours.”

What Washington Didn’t Like About the Comcast-Time Warner Cable Deal

http://www.phillipdampier.com/video/Bloomberg What Washington Didnt Like About the Comcast-TWC Deal 4-23-15.flv

What Washington Didn’t Like About the Comcast-Time Warner Cable Deal: Comcast is planning to walk away from its proposed takeover of Time Warner Cable, people with knowledge of the matter said, after regulators decided that the deal wouldn’t help consumers, making approval unlikely. Bloomberg’s Peter Cook, Scarlet Fu, Alex Sherman and Cory Johnson have more on “Street Smart.” (6:18)

FCC Staff Recommends Sending Comcast/TWC Merger to Seventh Level of ‘Deal-Killing’ Hearing Hell

fat+lady+sings-featureThe staff at the Federal Communications Commission decided Wednesday to make a non-decision decision regarding the merger of Comcast and Time Warner Cable, and are recommending turning over the matter, including millions of pages of company documents and 14 months of investigative findings to an administrative law judge to sort out.

The procedural move, dubbed by many regulatory experts as a “deal-killer,” is known officially as a “hearing designation order.” But executives at Comcast know it really means the FCC is sending a strong signal it does not believe the merger is in the public interest.

The sudden recommendation by the FCC is seen by some observers as a coordinated move with the U.S. Department of Justice to let Comcast CEO Brian Roberts know the deal is in serious peril. In 2011, the Justice Department declared its opposition to another blockbuster merger between AT&T and T-Mobile, and the FCC announced its own opposition just a few hours later. The merger was declared dead shortly thereafter.

Placing the matter in the hands of an administrative law judge would mean a drawn-out, complicated hearing that would probably last longer than the 1995 trial of O.J. Simpson. Few companies bother. Even if Comcast decides it will fight, if the Justice Department successfully challenges the merger in court, the hearing designation order is moot and the merger fails.

Most observers expect Comcast will call off the merger before dragging the matter out in a court or hearing room.

The Wall Street Journal broke the story last night, calling it a “significant roadblock.”

Wall Street analysts were more direct.

“The fundamental problem with this transaction is there is no major constituency outside of Comcast and Time Warner Cable that want it to move forward,” said Rich Greenfield, analyst at BTIG Research, which has been predicting the deal falls apart. Mr. Greenfield noted that it would be a “very uphill battle” for Comcast to prove its case through the FCC’s hearing process that its merger is in the public interest. “Is it really worth spending more time and resources to fight the government?”

elephant“I’d never say anything was 100 percent dead, but this is in the 99 percent category,” Greenfield added. “It’s not every day that you have a transaction that is universally hated by everyone outside of Philadelphia,” where Comcast is based.

“No, the Comcast deal isn’t dead yet,” said telecom analyst Craig Moffett on Thursday. “But it’s a bit like an elephant that has been dropped out of an airplane. At around 10,000 feet, it is technically still alive. But it is falling fast, there’s not much you can do to stop it, and its odds of survival are pretty low when it hits the ground. Engaging in a war of attrition with the U.S. government is generally a bad idea and one rarely undertaken.”

The usually brash and confident Comcast was uncharacteristically muted in their response to the latest DOJ and FCC developments.

“As with all of our DOJ discussions in the past and going forward, we do not believe it is appropriate to share the content of those meetings publicly, and we, therefore, have no comment,” said a Comcast spokeswoman.

The apparent looming defeat of the Comcast/Time Warner Cable merger would be a testament to unified opposition from consumers, programmers, competitors, and emerging online video distributors that might one day fully challenge traditional cable television.

“In a democracy like this, you have gather your forces to say no to politically powerful people,” Mark Cooper, a Comcast opponent and research director at the Consumer Federation of America, told the Philadelphia Inquirer.

http://www.phillipdampier.com/video/CNN Death sentence for Comcast merger 4-23-15.mp4

A death sentence for the Comcast-Time Warner Cable merger? Analysts think so. CNN reports on the history of a merger deal that used to be “inevitable.” (1:42)

Comcast-Time Warner Cable Merger Setback

http://www.phillipdampier.com/video/CNBC Comcast-TWC merger setback 4-23-15.flv

The Wall Street Journal is reporting the FCC is issuing a “hearing designation order” for the Time Warner Cable-Comcast proposal, with Henry Blodget, Business Insider. (2:10)

The FCC, the DOJ, and the Case for Blocking the Comcast-Time Warner Cable Deal

http://www.phillipdampier.com/video/Bloomberg FCC DOJ and the Case for Blocking Comcast-TWC Deal 4-23-15.flv

Comcast earned the opposition of the Federal Communications Commission, along with the Department of Justice, as it seeks to complete a $45.2 billion acquisition of Time-Warner Cable. Bloomberg’s Alex Sherman Reports on “Bloomberg Surveillance.” (2:17)

Comcast+TWC: Why a Cable Behemoth Would Be Bad for Business

http://www.phillipdampier.com/video/Bloomberg Comcast TWC Why a Cable Behemoth Is Bad for Business 4-23-15.flv

BTIG Media and Tech Analyst Rich Greenfield discusses the fight against a Time Warner Cable and Comcast merger deal. Bloomberg Intelligence’s Paul Sweeney also speaks on “Bloomberg Surveillance.” (5:10)

Chances of Comcast/Time Warner Cable Marriage Dwindling This Morning

http://www.phillipdampier.com/video/Bloomberg Will the DOJ Kill the Comcast TWC Merger 4-22-15.flv

Richard Greenfield from BTIG Research appeared on Bloomberg TV this morning to talk about the rapidly decreasing chances the Comcast-Time Warner Cable merger will make it past the Justice Department. The next question: Will Charter Buy Time Warner Cable next or will Time Warner Cable make a power play and buy Charter? (3:24)

Senate Democrats Want to Cancel Comcast-Time Warner Cable Merger Deal

Sen. Elizabeth Warren (D-Mass.) is among six Democratic senators urging the Justice Dept. and the FCC to reject Comcast's merger deal with Time Warner Cable.

Sen. Elizabeth Warren (D-Mass.) is among six Democratic senators urging the Justice Dept. and the FCC to reject Comcast’s merger deal with Time Warner Cable.

Six Democatic senators in states directly affected by the Comcast-Time Warner Cable merger want it canceled, and are urging regulators to reject the deal.

Sens. Elizabeth Warren (D-Mass.), Al Franken (D-Minn.), Richard Blumenthal (D-Conn.), Ed Markey (D-Mass.), Ron Wyden (D-Ore.), and Bernard Sanders (Ind.-Vt.) today signed a letter asking the Justice Department and the Federal Communications Commission to block the merger.

“We write to urge the FCC and DOJ to reject Comcast’s proposed acquisition,” reads the letter, organized by Sen. Al Franken (D-Minn.). “Should the transaction survive … we believe that Comcast-TWC’s unmatched power in the telecommunications industry would lead to higher prices, fewer choices, and poorer quality services.”

The six senators went straight to the top, addressing Attorney General Eric Holder and Federal Communications Commission chairman Thomas Wheeler. At least one House member is also opposed. Rep. Tony Cardenas (D-Calif.), represents a district in Los Angeles served by Charter Communications and Time Warner Cable. Customers of both companies in Los Angeles would be served by Comcast if the merger is approved.

Comcast’s reputation precedes it, and Time Warner Cable customers have overwhelmingly told regulators they’d prefer to keep the current cable company many loathe instead of taking a chance with Comcast, rated the worst company in the United States by Consumerist.com.

“We have heard from consumers across the nation, as well as from advocacy groups, trade associations, and companies of all sizes, all of whom fear that the deal would harm competition across several different markets and would not serve the public interest,” the letter adds.

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