Comcast Corporation (NASDAQ:CMCSA) proposed acquisition of Time Warner Cable Inc (NYSE:TWC) for $45 billion is receiving a lot of flak from Netflix, Inc. (NASDAQ:NFLX). The two companies, Comcast Corporation (NASDAQ:CMCSA) and Netflix, Inc. (NASDAQ:NFLX) entered a major verbal war recently when the former accused the latter of seeking “extortionate” demands as a result of the proposed acquisition. Variety Magazine recently did an article in which it elaborated the kind of accusations these two companies have been leveling on each other.
Comcast Corporation (NASDAQ:CMCSA) leveled those accusations against Netflix, Inc. (NASDAQ:NFLX) in comments that it filed with the Federal Communications Commission (FCC), saying that Netflix, Inc. (NASDAQ:NFLX) hasn’t filed ‘transaction specific’ complaints. Earlier in the year, Comcast Corporation (NASDAQ:CMCSA) and Netflix, Inc. (NASDAQ:NFLX) had reached an agreement in which the latter agreed to pay the former a fee so that customers can enjoy Netflix, Inc. (NASDAQ:NFLX)’s services without any hassles.
Comcast Corporation (NASDAQ:CMCSA) used the statement given by Netflix, Inc. (NASDAQ:NFLX)’s CEO, Reed Hastings after signing of the agreement in its filing. Hastings had said, “We found middle ground on our issues that worked well for both of us for the long term, and works great for consumers”.
Netflix released a statement following the accusation from Comcast in which it said that asking Comcast to deliver the speeds for which its customers have paid for is not extortion, but it is extortion when Comcast demands a ‘ransom’ from Netflix , even when the former’s customers have already paid it to receive decent speeds at which they could view Netflix’s content.
“If the merger were to proceed, this one company, Comcast, would have control over high-speed residential Internet in a majority of American homes and that is clearly not ‘great’ for consumers,” Netflix was quoted as saying in the article.
As of June 30, 2014, Carl Icahn’s Icahn Capital LP owns over 1.7 million shares in Netflix, Inc. (NASDAQ:NFLX) and Ken Fisher’s Fisher Asset Management owns over 12 million shares in Comcast Corporation (NASDAQ:CMCSA).
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