Collectivize Comcast!

Comcast LogoDuring her successful campaign for Seattle City Council I pooh-poohed critics who denounced Socialist Alternative candidate Kshama Sawant as unelectable due to her party’s stance in favor of collectivizing the Fortune 500. She was running for city council, for chrissakes. It’s not like she was going to make collectivizing Boeing a councilmanic priority.

But the collectivization thing does rub a lot of people the wrong way, striking them as both un-American and impractical. And while I generally share that skepticism, that won’t stop me from making the following bold proposal: Collectivize Comcast.

Comcast is fast becoming a dangerously large corporation with the economic power, media might, and political influence to twist public policy contrary to the public good. While perhaps not quite yet a monopoly in the old Ma Bell sense of the word, its dominant position as a broadband provider threatens to saddle American businesses and consumers with slower speeds and higher prices than much of the rest of the world enjoys. Comcast’s push to end net neutrality could impose a toll on innovation, while its self-interest in sucking profits from the infrastructure it has rather than investing in the infrastructure we need must be viewed as nothing less than a tax on US economic competitiveness.

Besides, everybody hates Comcast. So let’s collectivize it.

And by “collectivize,” I don’t mean taking their assets by eminent domain or some extraordinary property grab. I mean collectivizing the American way: via a hostile takeover of a public company… but financed by US taxpayers rather than hedge fund managers or LBO conmen.

At about $50 a share, Comcast currently has a market capitalization of just under $130 billion. Offer $60 a share—a 20 percent premium—and a majority of shareholders would likely sell out in a heartbeat. And you don’t even need to buy all the shares. Just enough to control the board. For a federal government that’s created trillions of dollars in new money via “quantitative easing,” that sort of cash would be chump change.

And we don’t even want all of Comcast. Once taxpayers seize control of the company we can recoup some of the cost by selling off all the parts we don’t need: NBC/Universal, its professional sports teams and stadia management business, and other valuable properties. All we want is the broadband business—a public utility—as the basis for building a national, publicly-owned broadband network.

It’s not as outrageous a proposal as it may at first sound. The federal government bought controlling interest in GM, Chrysler, Fannie Mae, and Freddie Mac when they faced collapse, because our leaders determined it to be in the public interest. Well what could be more in the public interest in the 21st century than assuring open and equal access to an affordable, high speed Internet?

Besides, just talking about collectivizing Comcast has value in itself. Remember, everybody thought Sawant was crazy for campaigning on a $15 minimum wage, and a year later, Seattle is on the verge of passing one. Debating a public takeover of Comcast seriously, by whatever term of art we choose, would be an exercise in going on the political offensive. And if executives at Comcast and other telecom giants begin to feel some genuine pushback, perhaps they’ll think twice before pushing their anti-competitive agenda too far.

Comments

  1. 1

    Travis Bickle spews:

    Why stop there? With AT&T in talks to buy DirectTV, you can just scoop them up as well, right after their merger is complete. Then you have a monopoly.

    You can afford to pay any price – it’s the government buying them, so just print more money, right? Who’s to know?

    Or, you could just let AT&T/DirectTV compete with Comcast as essentially an equal, and then you don’t have to write posts like this.

  2. 2

    Travis Bickle spews:

    Just curious, since you brought up Sawant’s party….

    In that minimum wage poll you wrote about yesterday, specifically the credibility question at the bottom of page 7…

    Which entity was at the very bottom of that credibility list?

  3. 4

    Travis Bickle spews:

    @ 3

    I’m hypertensive. I’ll die long before anything happens that might make me nervous for other reasons.

    I just figured the Comcast 800# gorilla piece should have been posted before the emergence of a formidable competitor, not after the announcement.

  4. 6

    Travis Bickle spews:

    @ 5

    It’s not about the broadband. It’s about the bundling.

    That ATT/Direct TV thing caught you by surprise, didn’t it?

  5. 7

    Chris Stefan spews:

    Well something a little more local we can do right now is decline to renew the Seattle Comcast franchise in 2016. Have the city buy the infrastructure and run it as a public utility. Much like how City Light was created by buying out Puget Sound Power & Light in the first half of the 20th Century.

    Broadband is as important piece of infrastructure in the 21st Century as electricity was in the 20th.

  6. 8

    headless lucy spews:

    re 1 — Do you really conceive of a ‘free market’ as two gigantic communications companies going after the same captive customer base?

  7. 9

    Travis Bickle spews:

    @ 8

    If there are massive infrastructure costs I see ‘free market’ as anything greater than one, yes.

    It’s not like they’re competing over which can make the best burger.

  8. 10

    Haganah spews:

    Nope. Sorry but no matter how shitty Comcast may be, the government does not have the right to steal the company. You want that, move to South America.

  9. 11

    guerre spews:

    My crazy socialist idea is to have municipality broadband and have a $1-10 surcharge per month to pay for local news, perhaps with grants. The current media landscape is pathetic and reporters need unbiased secured funding. People like me don’t pay for news and then we complain that there is no quality news? What is an extra $12 a year compared to getting high quality journalism? Journalism is a public good, like transit, and should be funded as such.

  10. 12

    Travis Bickle spews:

    I see people are expressing their inner Chavez today. So, we’ll have government-funded journalists? Dependent on grants from those in office?

    Everybody OK with that when the government swings right? Or just when it’s your team in office?

  11. 13

    headless lucy spews:

    re 9 — “If there are massive infrastructure costs I see ‘free market’ as anything greater than one, yes.”

    Don’t be fatuous, Bickle. How about the taxpayer expense in putting up the communications satellites? The cable companies only have a viable business model because they are permitted to block the signal from anyone setting up their own dish.

    They are more like heroin dealers than legitimate businesses. You put that kind of power in the hands of a few communications companies and you are asking for trouble. You seem very worried about the government having a monopoly, but what is the difference when big business owns the government?

  12. 14

    spews:

    @6 Surprised? No, I expect you to raise irrelevant red herrings. DirecTV is not a broadband company.

    @10 How would this be stealing? We’d be buying shares on the open market. Nobody would be forced to sell.

  13. 15

    headless lucy spews:

    re 12 — “So, we’ll have government big business -funded journalists science? Dependent on grants from those in office the boardroom?”

    When people accuse right-wingers of being Fascists, we’re not necessarily saying they know they are Fascists.

  14. 16

    Travis Bickle spews:

    @ 13

    Not sure I’m following you. A lot of satellites are privately owned, launched by private corporations. Russia makes good coin giving rides to private satellites when they send their cosmonauts up.

    Even NASA is cutting back and some of what they used to do will be done in the future by private corporations.

    The argument you are making might not be valid now and might be less so in the not-too-distant future.

    Try your argument with cable and it’s probably a better one. Even so, if massive outlays of money by private corporations occur, there likely will be only one or two with the wherewithal to do so. So with very expensive technologies you’re less likely to see several companies competing. Only one or two may be able to afford it.

  15. 17

    Travis Bickle spews:

    When US government-appointed Board members of the new government-controlled Comcast Goldy envisions do not act in the best interests of the company, do the other shareholders have standing to sue? What entity do they sue? Comcast? The US government? The government-appointed Board members?

    Or do the Board members receive some sort of immunity from liability for not doing what they are supposed to do under US corporate law?

    Does Comcast, once government-controlled, get a $50B bonus from the IRS, reducing its future tax liability the way that GM, once controlled by the government, was given prior to its emergence from bankrupcty proceedings?

    Why would the government sell off NBC if it gained control of Comcast? Doesn’t it need MSNBC to shill for it, at least until November, 2016?

  16. 18

    spews:

    I prefer the word utilize, as in, forming a utility.
    Since Comcast does not have an incentive to supply fiber to the premises in the poorest of Seattle’s neighborhoods, we should form a utility. All of the citizens of Seattle could utilize it.

  17. 20

    spews:

    So, how about you contact Tina Podlodowski, and make yourself useful.
    Because the mayor announced on May 8th, that Tina “Podlodowski will return to the Mayor’s Office of Policy and Innovation to focus on developing new policy options for public broadband in the city.”

  18. 21

    headless lucy spews:

    Travis — The inability of smaller business entities to compete in building and/or competing to use infrastructure (smaller doesn’t necessarily mean of lesser quality) is not because they don’t ‘have’ the capital. It’s because they don’t have access to the capital.

    I do find it interesting, though, that you now seem to be proclaiming that only big businesses can provide certain services. Now you are making an argument that would play into the ‘big government’ argument.

    Why do you feel that private monopolies are OK, but government hegemony is not?

    For an example of a small internet provider that started in Sierra Vista AZ in the 1990′s, check out ‘The River”.

  19. 23

    LeftyCentrist spews:

    Or we could look at bringing back mandated infrastructure sharing. It’s an approach that has worked out reasonably well elsewhere in the world.

  20. 25

    Roger Rabbit spews:

    “Besides, everybody hates Comcast.”

    Not everybody. My stockbroker likes Comcast. So do lots of investors. How can the capitalist crowd not like a piratical company with monopoly pricing power whose dividends have tripled and stock price has quintupled in the last 5 years? The worse a company is for consumers, the better for investors!! That’s why people invest in the dirtiest, most obscenely corrupt, slimiest companies they can find!! The more fines a bank pays for lawbreaking, the higher its stock goes!! If greed is good, evil is better!!

    Full Disclosure: Roger Rabbit owns stock of antisocial companies, but not this particular one.

  21. 26

    ArtFart spews:

    To clarify a thing or two…

    A lot of satellites are indeed privately owned, and I wouldn’t be surprised if the majority of the launches at Cape Canaveral these days are private satellites or ones owned and operated by the intelligence community. Regardless of that, the Internet backbone consists of terrestrial links. The reason for this is that given the 46,000 mile round trip to geosynchronous orbit, the latency would be unacceptable to the gamers but more importantly, the financial institutions whose profit or loss depends on doing transactions a few microseconds faster than the competition.

    The backbone consists of a bunch of infrastructure owned and operated by a few companies you’ve heard of (like AT&T) and quite a few you probably haven’t. Some of them specialize in running parallel “peering” schemes to deliver media-rich traffic to hubs in major population centers and bypass most of the “choke points”–for customers who are willing to pay the freight. In this respect, there have -always- been “slow lanes” and “fast lanes” on the “information superhighway” since it was a dirt road.

    The other half of the “net neutrality” equation has more to do with the “last mile” to the homes of civilian subscribers. The case everyone’s probably most familiar with is of course Comcast throttling Netflix because it competes more or less directly with Comcast’s premium cable TV services. The real issue here is whether one provider can effectively block or render unusable an online service which competes with its own business interests. From there on it gets more icky–what the media giants and the providers (who in some cases are the same entities) really want is to commandeer the Internet and turn it into their own “next-generation” version of cable TV, and let anyone who wants to use it for much else go piss up a rope.

  22. 27

    ArtFart spews:

    @21, @22 Nearly 20 years ago, we first signed up for DSL service with Qwest, using a local “clec” back-end provider called oz.net which operated out of the Westin Building. A few years later they were acquired by The River, which then merged with an outfit called Nationwide which I believe was at least partly owned by Enron. That eventually fell apart (surprise!!!), and the Puget Sound infrastructure and customer base fell into the hands of a tiny dial-up provider in Virginia.