Reelecting President Barack Obama won’t stop but may slow the...
Reelecting President Barack Obama won’t stop but may slow the “telecom establishment,” said Guggenheim Securities on Thursday, a few days after handicapping various outcomes if Mitt Romney is elected in November on the Republican presidential ticket. Analyst Paul Gallant described…
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the establishment as Verizon, AT&T, Comcast, Time Warner Cable, Cablevision and Charter. “On the wireless front, AT&T and Verizon probably would face regulatory efforts aimed at preventing them from: (1) evolving into a de facto wireless duopoly; and (2) leveraging their networks to better control OTT threats and opportunities,” Gallant said. “For cable operators, a second Obama term could lead MSOs [multiple systems operators] to proceed cautiously in converting their broadband speed advantage over DSL into improved margins via more aggressive usage-based pricing models.” A second Obama term would benefit “underdogs,” however, which include Sprint Nextel, Deutsch Telekom’s Mobile, MetroPCS, Leap, US Cellular and Republic Wireless as well as “potentially disruptive firms” like Netflix, Google and Amazon, Gallant said. Guggenheim gave several examples of how a Democratic administration would affect different issues, suggesting it would maintain net neutrality and be more receptive to the regulation surrounding Netflix. “An AT&T-Dish deal probably would be approved under a second Obama Administration,” Guggenheim said. “But the odds would be somewhat higher, and the givebacks somewhat lower, under a Romney Administration.” A Romney presidency would benefit AT&T and Verizon as well as Comcast, Time Warner Cable, Cablevision and Charter, Guggenheim said Tuesday. Wireless competitors, CLECs and “edge firms” like Netflix and Google would face a “more difficult policy environment” under Romney, Gallant said. His analysis doubts there'd be much of an impact on smaller broadcasters and content owners. “AT&T and Verizon (as well as other wireless operators) would likely benefit from Republican opposition to net neutrality rules,” Gallant said. Smaller wireless operators “probably would have less support from the FCC in areas like acquiring spectrum in auctions, roaming fees, special access pricing, and handset interoperability” under Romney in comparison to Obama, the firm noted. It has a “bullish outlook” on cable due to greater broadband pricing power and less risk to cable’s pay-TV business.