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Comcast vows improved service with AT&T

Comcast Corp, the No. 3 US cable-television operator, said its planned US$72 billion purchase of AT&T Corp's Broadband unit will let the company offer additional fast Internet services and digital video.

The combination would benefit consumers, Comcast and AT&T said in a filing at the Federal Communication Commission. The FCC plans to review the merger for no more than 180 days.

The new company would have 22 million customers in more than 40 states. Consumer groups oppose the combination because it would give Comcast too much power. The US is likely to approve the merger and may impose conditions for programming and Internet service using cable lines, lawyers and analysts have said.

"By uniting two companies with remarkably complementary assets, this merger will bring more digital services and features, to more Americans, more quickly," the companies said in the filing released by the agency.

Shares of Philadelphia-based Comcast rose US$0.50 to US$31.80 yesterday. They've fallen 16 percent since the sale was announced Dec. 19. Shares of New York-based AT&T, the largest US cable operator and long-distance telephone provider, rose US$0.25 to US$15.70. They've dropped 6.5 percent since the announcement.

Consumers Union will ask the FCC to force the combined company to sell systems with about 4 million customers, and give customers a choice of Internet providers, said Gene Kimmelman, co-director of the consumer group's Washington office.

"We think the merger creates a cable giant with monopoly power," Kimmelman said. "The combined entity will be in a position to effectively determine which programming makes it in the cable market and which high-speed Internet service can survive."

The new company would own, control or influence systems serving 34 percent of US cable and satellite subscribers, he said.
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