Comcast is officially walking away from plans to acquire Time Warner Cable, after regulators signaled their displeasure with the deal.
“Today, we move on,” Comcast Chairman and CEO Brian Roberts said in a statement. “Of course, we would have liked to bring our great products to new cities, but we structured this deal so that if the government didn’t agree, we could walk away.”
The deal almost seemed like a foregone conclusion when Comcast announced its $45.2 billion Time Warner Cable acquisition plan last year. As Bloomberg notes, the cable giant spends more money on lobbying in Washington than any other company, and dumped $17 million into its lobbying efforts in 2014 alone.
But ultimately, the U.S. Department of Justice and the Federal Communications Commission had too many concerns about the acquisition, which would have given the combined companies as much as 57 percent of the broadband market and nearly 30 percent of the pay TV market, the New York Times reports. For Comcast, pushing onward may have involved a lengthy FCC hearing that could have pushed the deal beyond its completion timeframe.
Further reading: Consumer groups dance on the grave of the dead Comcast-TWC deal
One concern that emerged recently was the role that Comcast allegedly played in preventing a sale of Hulu, which is co-owned by Comcast, 21st Century Fox, and Disney. Comcast was supposed to stay out of any Hulu business dealings as a condition of acquiring NBCUniversal (which co-owned Hulu) in 2011. A Wall Street Journal report this week suggested that Comcast influenced the sale process by assuring Fox and Disney that it would help turn Hulu into a platform for the cable industry. This reportedly became a sticking point for the Justice Department as it mulled potential merger conditions for Comcast and Time Warner Cable.
Why this matters: Although Comcast and Time Warner don’t operate in the same market—and therefore aren’t direct competitors—consumer groups worried that the combined company would have too much bargaining power in TV carriage agreements, content licensing and interconnection deals for Internet services. Comcast said the acquisition would lead to better service for customers, but now it’ll just have to find another way.