Could Comcast, Time Warner merger suffocate competition in the weather space?

September 2, 2014

(WeatherNation)

Could a Time Warner-Comcast merger compromise weather information competition? That’s what WeatherNation, a weather provider both on cable television and online, argues in a petition to block the merger of Time Warner Cable and Comcast.

The petition, which was filed August 25, is both WeatherNation’s scathing review of The Weather Channel’s efforts to stifle competition and its lens into the harm such a merger would cause, particularly with respect to its interests both in TV and online.

The Weather Channel is owned in part by NBCUniversal, which is a subsidiary of Comcast, as well as investment groups Bain Capital and The Blackstone Group.

The petition states that with a potential audience of 99.9 million cable subscribers, The Weather Channel is WeatherNation’s chief competition in the TV and online space, in addition to being the industry leader in supplying data and video feeds, often to its own competition.

The Weather Channel has become a dominant force in the private sector weather market, most notably since it purchased the website Weather Underground as well as Weather Central in 2012. The Weather Company also owns the data provider Weather Services International (WSI), as well as its website, Intellicast.

Related: Weather Underground purchased by Weather Channel |  Weather Services International buys Weather Central

Competition between WeatherNation and The Weather Channel climaxed in the recent dispute between DirecTV and The Weather Channel. DirecTV removed The Weather Channel from its lineup in January in a battle over carriage fees that started in late 2013 (The Weather Channel returned to DirecTV in early April). WeatherNation was suggested as a replacement, which had just entered the DirecTV lineup on December 16.

On December 17, just a day after WeatherNation appeared in the DirecTV lineup, the petition states: “The Weather Channel (through WSI) engaged in what seemed an attempt to use its leverage over a critical input to stifle the new competition.”  At that time, WSI, a data vendor that many local and national media organizations use to disseminate weather information, sent a draft to WeatherNation demanding a subscription increase of 57.5 times the amount that WeatherNation had previously been paying.  The price hike was “astonishingly unreasonable” and “would have driven Weather Nation out of business,” the petition states.

WeatherNation dropped WSI for a less expensive data provider, but the animosity did not stop there. When The Weather Channel was taken off DirecTV in January, Weather Company CEO David Kenny belittled WeatherNation as a replacement:

[DirecTV] is trading safety for increased profits and replacing the experience and expertise of The Weather Channel with a cheap startup that does weather forecasting on a three-hour taped loop, has no field coverage, no weather experts — certainly not any on par with The Weather Channel network’s industry-recognized experts,” Kenny said in a statement after DirecTV dropped The Weather Channel from its lineup.

Related: DirecTV drops Weather Channel from its lineup

The petition argues that these weather wars would likely continue due to loopholes in regulations of cable TV and internet, and could lead to the demise of WeatherNation altogether, should the FCC approve the merging of Time Warner and Comcast, which would increase Comcast’s TV subscribers by nearly a third.

Despite FCC rules intended to prevent cable operators from favoring their own channels, WeatherNation president Michael Norton says companies like Comcast have always been able to make it appear as if they are treating programmers fairly.

“A cable operator might pay its own weather channel 10% of the going rate for WeatherNation TV and say, do you want the same thing we pay our channel or not?,” Norton wrote in an email on the petition. “The rate might be so low that we’d put ourselves out of business if that became the prevailing price for our service. The cable operator then can say to the FCC, we offered the same price we charge our own service and WeatherNation turned us down, so that’s not our fault.”

Related: The future of WeatherNation: Interview with president Michael Norton

In addition to the competition on TV, WeatherNation has also entered the club of companies competing for ports on Comcast’s broadband network. WeatherNation worries Comcast will violate what’s known as net neutrality, the idea that all internet data  be created and disseminated equally without discrimination according to user, platform or type of content.

Norton contends  that just as Comcast strong-armed Netflix in net neutrality wars, so too can it impose corporate sanctions on WeatherNation.

“Netflix and other companies have stated publicly and in documents filed at the FCC that Comcast systematically refused to install a sufficient number of ports, thereby slowing down traffic of the competing online content providers and ruining the speed and quality of those services,” Norton says.

The merger potentially imperils the quality and diversity of available weather information, Norton says. “The more competition, the better.  Allow one company to control all weather information, however, and you won’t have that competition. You won’t have the best possible dissemination of critical weather data.”

“People’s safety is at stake,” he says.

(The Weather Channel declined to comment for this story.)

Update, 5:22 p.m.:  A Comcast spokesperson emailed the following statement:

“Comcast carries over 160 independent programmers and has continued to increase our carriage of independent programming after the NBCUniversal acquisition.  The amount of multichannel video subscribers that Comcast will have after this deal is below a level the courts have found twice does not hinder competition.  70% of multichannel subscribers nationwide will belong to other companies, more than enough the courts have ruled for programmers to not face issues.  Comcast NBCUniversal does not manage or operate The Weather Channel.”

Jason is currently the Washington Post’s weather editor. A native Washingtonian, Jason has been a weather enthusiast since age 10.
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