N.Y. AG settles with cable providers

Bryan Cohen Aug. 17, 2012, 1:27pm


NEW YORK (Legal Newsline) ' New York Attorney General Eric Schneiderman announced a settlement on Thursday with Time Warner Cable, Verizon and three other cable operators that requires the companies to improve the protection of competition.

The Antitrust Division of the U.S. Department of Justice and Schneiderman's office filed a civil lawsuit on Thursday to prevent commercial agreements the companies reached in December from going forward as originally drafted. The original agreement between the companies would allow Verizon Wireless to become a seller of Time Warner Cable Services, which brought up concerns of cooperation instead of competition.

"New Yorkers deserve a fair, competitive marketplace when they are looking for a broadband or cable provider," Schneiderman said. "These changes help ensure that our leading service providers continue to compete, rather than collude. The revised agreements reinforce incentives to continue to market and build broadband, something that is desperately needed to reduce the digital divide in New York state."

The antitrust division and Schneiderman's office filed a proposed settlement that would resolve the antitrust concerns if approved by the court. The settlement prohibits Verizon Wireless from selling cable company services in regions where Verizon's competing FiOS product is or will be offered.

New York consumers expressed concern that competition would be reduced in areas where Time Warner Cable and Verizon both offer video and broadband services. FiOS is an alternative to cable, including the services offered by Time Warner Cable, in many parts of New York. If Verizon Wireless became a seller of Time Warner Cable services, the two companies could cooperate to create higher prices and less choice for consumers in New York.

The settlement also applies to Comcast, a company with a limited number of customers in New York.

The original agreement between the companies included a joint venture that would allow the companies to develop new wireless and wireless service-related technologies. The proposed settlement changes the joint venture by limiting its duration to five years to make sure the agreement does not reduce the companies' future competition incentives.

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