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Comcast-Time Warner Cable implosion shows limits of big money in Washington

April 23, 2015, 10:47 PM UTC

There will be a plenty more to say about the collapse of the Comcast’s bid for fellow cable giant Time Warner (TWC) once the dust settles. Already, the implosion of the $45 billion deal confirms an emerging truth: Money and connections don’t necessarily guarantee success in today’s Washington.

Comcast maintains one of the priciest lobbying machines in the city, spending $4.6 million in the first quarter of this year alone on a roster that includes some three-dozen outside firms. That made it the second most expensive corporate operation, behind only Google, which spent $5.5 million in the first three months of the year. Add in Time Warner Cable’s $1.7 million expenditure in the same period, though, and the assembled might of the two companies dwarfs the field.

But Comcast (CMCSA) hasn’t just shoveled money around K Street. Its executives have also invested in developing deep, personal relationships at the pinnacle of power. Comcast CEO Brian Roberts feted President Obama on Martha’s Vineyard in his first term and golfed with him there in his second. And Obama held so many fundraisers in the suburban Philadelphia home of David Cohen — Comcast’s executive vice president and chief political operator — that in 2013 the president joked, “the only thing I haven’t done in this house is have Seder dinner.”

When it counted, Cohen found that goodwill was worth precisely nothing. After the November elections, Cohen called Valerie Jarrett, Obama’s senior adviser, to object to the administration’s move toward strict new Internet regulations — and was met with a stiff-arm. The FCC went on in February to heed Obama’s call for “the strongest possible rules” governing Internet providers like Comcast, reclassifying high-speed broadband service as a public utility.

In retrospect, that decision presaged bad news for Comcast’s proposed deal: The chance to humble hated telecoms prompted an unprecedented gusher of 4 million public comments. The proposed merger elicited a public push-back on the same scale, reaching into the high six-figures. “A lot of people said to themselves, ‘These things are connected,’” said Michael Copps, a former FCC commissioner now advising Common Cause, an opponent of the merger. “They’re both gate-keeping issues, and they’ve helped propel a developing national consciousness about this.”

Meanwhile, members of Congress, who have no direct input on the process but can use their oversight authority to pressure regulators, mostly hugged the sidelines — another victory for the deal’s opponents, considering the cable companies’ lobbying brawn. A handful of ad hoc groups helped rally the opposition, led by the Stop Mega-Comcast Coalition. That outfit, formed in January, is helmed by the Glover Park Group, a bipartisan lobbying firm founded by senior Clinton administration alums. It cobbled together some of the cable giant’s corporate foes — Dish Network and The Blaze, Glenn Beck’s cable network — with public-interest groups like the Consumers Union and Public Knowledge. A hodgepodge of other critics — including Netflix (NFLX) and rural broadband providers — managed their own opposition efforts.

One lobbyist working against the deal said he was surprised at the level of antipathy he encountered toward the cable companies from lawmakers and staff who’d had bad experiences with them as customers. And that sentiment reflected a broader public attitude that shaped the context for the deal’s consideration. “The cable lobby is undoubtedly very sophisticated,” this lobbyist said, “but there are limits.”

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