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Comcast a $19 million lobbying powerhouse

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Bloomberg News
Published:
WASHINGTON — At a museum near the Capitol three weeks ago, 700 guests sampled bratwurst and vodka and watched the Olympics on a mammoth screen. From the second floor, Comcast’s David Cohen addressed the crowd, which included the Russian ambassador and a White House official.
Four nights later, Cohen donned a tuxedo, bow tie and cummerbund for a White House state dinner. This week, Cohen was at a charity event at a bowling alley that attracted a half-dozen U.S. senators.
Companies often want their lobbyists to hobnob with Washington lawmakers and regulators. Comcast has taken that to new levels in recent years, increasing lobbying expenditures by 23 times over 2001 levels, to $18.8 million last year - behind only Northrop Grumman in spending by a single company.
Comcast has a new target for its lobbying: regulatory approval for a $45.2 billion deal to buy Time Warner Cable.
“They are ubiquitous,” said Gene Kimmelman, the Justice Department’s former chief competition counsel. “They really have everything covered at the highest levels of skill and experience.”
Led by Cohen, executive vice president in charge of government affairs, Comcast deploys more than 100 lobbyists, donates millions of dollars to politicians through its political action committee, gets help from charities it supports and enlists two former senators, three retired House members and an ex-Federal Communications Commission member.
“I have an old fashioned view of advocacy,” Cohen said. “If you’re right on the merits, you deserve to succeed.”
Comcast has proven it can win U.S. approval for deals, which is how it became the nation’s No. 1 cable company.
Other companies schmooze and spend in Washington, too. According to the Center for Responsive Politics, a Washington group that tracks political spending, AT&T spent $15.9 million lobbying in 2013 - down from $20.2 million in 2011 when it tried and failed to win U.S. clearance to buy T-Mobile US Inc. Verizon Communications spent $13.7 million to lobby last year.
What makes Comcast stand out is its approach to the deal.
First, pick targets that aren’t direct competitors. AT&T’s T-Mobile bid challenged antitrust orthodoxy head-on, because it would have eliminated a direct competitor. Comcast “picks its mergers wisely,” said Mark Cooper, research director for the Consumer Federation of America.
NBCUniversal, Comcast’s 2011 acquisition, is in the entertainment and broadcasting business. While Time Warner’s in cable, it doesn’t compete for subscribers in the same areas as Comcast.
Second, give a little to get a little. Verizon, for instance, took the FCC to court over rules on keeping Internet access wide open. Comcast accepted these rules, known as net neutrality, as it carried out the NBCUniversal merger, and the FCC smiled on the transaction.
In the Time Warner deal, Comcast announced it would spin off 3 million subscribers, to keep its total below 30 million, even though there are no rules limiting cable subscribership.
Comcast also “knows how to make concessions unlike AT&T, which never makes a concession,” Cooper said.
Comcast offered poor families low-price Internet access, Cooper said. Regulators required it to share NBC programming with online rivals and satellite-TV providers.
It’s “not a lobbying effort,” Cohen said. “It’s about making a legal and ethical case to the FCC and the Department of Justice.”
Being No. 1 is a far reach from Comcast’s origins. Ralph Roberts, father of current Chief Executive Officer Brian Roberts, moved into cable after a varied path that included selling bottling equipment, scented ink and golf putters that he got Bob Hope to grasp for a photo opportunity, according to his interview with the Cable Center, a Denver-based non-profit.
The senior Roberts was manufacturing men’s belts when he saw an advertisement for Sansabelt slacks that featured elastic waistbands - eliminating the need for belts, he feared. Roberts cashed out and in 1963 bought a cable system in Tupelo, Miss., with 1,200 subscribers.
In 1972 the company’s shares began trading; in 1986 it doubled in size by acquiring Group W Cable Inc. Comcast’s purchase of AT&T’s cable business in 2002 made it the biggest U.S. cable operator with 22 million customers. Four years later, Comcast split the subscribers of bankrupt Adelphia Communications with Time Warner Cable. In 2011 it bought NBCUniversal, adding a TV network, movie studio and channels such as MSNBC and USA Network to its stable.
Comcast had 26 lobbyists when it bid on AT&T’s assets in 2001. That number grew to 107 last year, according to the Center for Responsive Politics.
The company’s lobbyists include Meredith Attwell Baker, who as an FCC commissioner in 2011 voted to let Comcast buy NBCUniversal. In 2013, five former members of Congress were lobbying for Comcast, from ex-Democratic Senator Blanche Lincoln of Arkansas to Senate Republican Whip Don Nickles of Oklahoma.
“This is a company that is playing all the angles, making sure that they have an open door on both sides of the aisle,” Sheila Krumholz, CRP’s executive director, said in an interview.
“They have a burden that Boeing or General Motors doesn’t have,” said Leo Hindery, the managing partner of private-equity fund InterMedia Partners LP in New York. “Every action that Comcast takes — every action — is scrutinized every day and can almost immediately lead to legislation.”
Cohen joined the company in 2002 after honing political skills working for former Philadelphia mayor and later Pennsylvania Gov. Ed Rendell. He worked with Brian Roberts to lure the Republican Party’s 2000 national convention to Philadelphia.
Cohen and his wife, Rhonda, funneled at least $500,000 to President Obama’s re-election bid in 2012. Roberts, also a big Democratic donor, gave more than $82,000 to national party organs since 2009.
Roberts at times joins Cohen in visiting Washington.
“They always have their facts marshaled,” said Rick Boucher, a former Virginia congressman who played host to Cohen and Roberts during his 28 years in Congress. He now heads Sidley Austin LLP’s government strategies group in Washington.
Comcast’s political action committee grew ten-fold since 2002, spending $3.5 million in the 2012 cycle, according to CRP.
The company also makes friends via the nonprofit Comcast Foundation that Cohen co-chairs. It donated $16.2 million to charities in 2012. The U.S. Hispanic Chamber of Commerce received $20,000 in 2011, and it supports a bigger Comcast.
“The real reason we support them is literally the hundreds of millions of dollars in contracts with women and minority- owned business that Comcast does,” Chamber President Javier Palomarez said in an interview. “If Comcast doesn’t give me another dime, that’s irrelevant.”
Comcast’s Washington visibility is growing alongside its interests. The Olympics party Feb. 7 engulfed the Newseum where partygoers including Tom Power, White House deputy chief technology officer for telecommunications, could use glowing braziers to roast marshmallows or play a version of ice curling. Power declined to speak with a Bloomberg News reporter at the event. He attended in a personal capacity and paid $83.70, the fair market value, Moira Vahey, a White House spokeswoman, said in e-mails.
The Feb. 25 fundraiser for Tracy’s Kids, a children’s cancer charity that Cohen and Comcast have sponsored for nine years, included screenings of Academy Award nominated films. Sen. Patrick Leahy, D-Vt., chairman of the Judiciary Committee that oversees antitrust activity, was there. Others attending were Democratic Sens. Mark Warner, Mark Pryor, Sheldon Whitehouse and Heidi Heitkamp and Republican Orrin Hatch. Rep. Xavier Becerra, D-Calif., posed for a photo with Cohen.
Lawmakers don’t play a direct role in clearing acquisitions. They do oversee the regulatory agencies, and can help to set a public tone that can hinder or speed a transaction. House and Senate lawmakers have said they’ll hold hearings on the cable deal.
Cohen and Roberts in conference calls Feb. 13 said the merger wouldn’t reduce competition. AT&T, Verizon, and satellite-TV providers Dish Network Corp. and DirecTV would face the same amount of competition, Cohen said.
The deal would leave Comcast serving less than 30 percent of the national pay-television audience, keeping it under a cap set by the FCC, Cohen said. A court threw out the cap at Comcast’s urging.
Still, critics find plenty not to like.
Michael Copps, a former Democratic FCC commissioner who’s now a senior adviser to the consumer group Common Cause, said Comcast’s lobbying effort can’t be matched by consumer groups like his that will be fighting back at the FCC, the Justice Department and in Congress.
“There’s a strong case to be made why this merger shouldn’t be approved,” said Copps, who was the only FCC commissioner to oppose the Comcast-NBC deal. “It’s just so much power for one company to amass, and it’s not just cable. They’re a broadband company, they’re a broadcast company, they’re new media, they’re old media, they’re telecom, they’re everything.”
Story tags » TelevisionLobbying

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