David Gelles argues that with the proposed $45.2 billion acquisition of Time Warner Cable, Comcast would become a “behemoth looming over the media landscape [and] could touch off a once-in-a-generation frenzy of deal-making.” “If Comcast drops you now, the other guys — DirecTV, Dish, Time Warner Cable — will pick you up…But if Comcast gets bigger and then dropped you, you couldn’t have a business.” Harvard Business Review disagrees: even though this deal means “Comcast would have 30 million subscribers, the most of any cable operator by a wide margin,” that’s still only about “thirty percent of total U.S. cable subscriptions, or about 25% of all U.S. homes, nothing close to a monopoly in the legal or any other sense of the word.” And discussing continued consolidation in the cable industry misses the bigger picture: “There is no cable industry. Cable is just a technology.” Combine that fact with the emergence of YouTube, Vimeo and Netflix (which is now producing its own Emmy-winning content) and “we’ve just begun sorting out the new business arrangements for a tidal wave of new content.” Also, Felix Salmon argues that if Comcast is allowed to buy TWC, “the cable companies will continue to price broadband at uneconomically high rates, in order to protect their cable TV cash cows.” Interestingly enough, broadband consumers in the United States pay significantly more for a slower broadband connection than in many other developed countries. The reason for this doesn’t appear to be supply & demand, rather that the cable-company gatekeepers price broadband very high to keep the margin low on cable TV subscriptions. It seems to me that this practice of bundling something less desirable with something more desirable at seemingly imbalanced prices goes to the core of what is at stake within the Comcast/TWC merger. Bundling has been an important strategy for both content and cable providers; but as technology continues to improve and companies like Netflix continue to create popular content, we can probably expect a tumultuous landscape as the ground shifts in the entertainment industry.
Senator Ted Cruz is working on a bill to remove some of the regulatory obstacles to oil and gas development in the United States. Since 2009, oil production has risen by 60 percent and added around $300 to $400 billion every year to the economy. Also, “foreign companies are expanding, or relocating to the United States, due to inexpensive energy. An Egyptian firm is investing in a billion-dollar fertilizer plant in Iowa, and a South Korean tire company wants to build an $800 million factory in Tennessee.” Then again, at least one group of researchers believe the U.S. shale revolution is all hype (“unconventional oil and gas development in the U.S. only added 0.88 percent to the U.S. gross domestic product between 2007 and 2012”) and should have little impact on Russian influence over Europe.
“Chinese demand for gold bars, coins and jewelry soared by 32% to record levels in 2013, even as the price of gold slumped 28%. The surge in buying saw China overtake India as the world’s top consumer of physical gold, importing 1,066 metric tons of the metal to India’s 975 metric tons in 2013.” Meanwhile, “investment funds dumped nearly $40 billion worth of gold in 2013 as the brighter world economic outlook encouraged a switch into riskier assets.” Also, China is being super serious about their trade data, ok?
“Language in House Bill 2524 and its companion, Senate Bill 6272, says the Department of Licensing would no longer be able to issue additional facility licenses to Tesla because of its status as a vehicle manufacturer and not as a dealer. The company sells cars directly from the manufacturer to the consumer…Washington State has the most Tesla vehicle sales per capita, [Tesla lobbyist Daniel Witt] said.” Meanwhile, this article from the San Francisco Chronicle is causing quite a stir: Apple’s M&A chief apparently met with Elon Musk last year and so now everybody wants to believe that Apple is interested in acquiring Tesla.