2 cable wiring companies sue Comcast
November 4, 2014
The decades long consolidation of local cable TV firms into a few national networks led by Comcast Corp. has squeezed local outfits that used to wire customers for cable, according to a Philadelphia Common Pleas Court lawsuit by two Pennsylvania firms.
Cable Line Inc. and McLaughlin Communications Inc. accuse Comcast Cable Communications of Pennsylvania Inc. of enticing them and other local operators to hire and train workers, add offices, borrow money for trucks and equipment – “only to abandon those firms once they had been induced to create the infrastructure necessary for Comcast’s expansion,” according to the lawsuit. The work was given to the larger firms Comcast favored “in order to monopolize the market,” it contends.
Comcast lawyer Joe H. Tucker urged a judge to toss the suit, arguing the firms’ contracts with Comcast should be used to settle disagreements. The court declined to dismiss, and the cable firms’ lawyer, Charles Mandracchia, of Skippack, tells me he has been preparing subpoenas for senior Comcast officials, including chief executive Brian Roberts. Comcast spokeswoman Jenni Moyer said the company had no comment.
“This is about more than my company,” said Kevin Diehl, owner of Cable Line. ” ‘Scale up or die,’ they told us. I bought a Harrisburg warehouse and a Perkasie office.”
Diehl claims he built a staff of 120 on Comcast promises. The suit says Comcast also used a clause in its Cable Line contract to block a $6.5 million purchase offer from Exelon.
Diehl said he believed his business had a future with the cable giant – until Comcast abruptly canceled its contracts in 2012 and gave the business to larger firms, which promptly recruited Diehl’s trained workforce.
McLaughlin Communications makes similar claims.
Diehl now runs a company, X Stream Media Group, that installs Dish satellite antennas in Cable Line’s old territory, Bucks and Montgomery Counties.
Data provided shareholders by Dycom, a Florida-based nationwide telecom installer that has acquired smaller firms in each of the past three years, shows AT&T, CenturyLink, and Comcast will jointly account for more than 50 percent of its business next year, up from 39 percent in 2012, after pending mergers are complete.
“This consolidation across the country is very bad for skilled cable technicians, who now have very few choices of employment,” and have complained of pay and benefit cuts, Diehl told me.
Yet installation is still a potentially lucrative business – for whomever controls it, Diehl added. The cable network his company and others built in the Philadelphia suburbs over the past 30 years is “obsolete,” he claimed. Comcast will soon feel obliged to upgrade, he predicted: “It should be fully fiber.”
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