The Deal That Died…

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It is officially dead.

 

The merger between Comcast and Time Warner Cable (TWC) is history.

 

The federal regulators ended this possible merger by saying that the combined company would be too big.

 

Mostly, the combined companies would have over 30% of the total television market and over 50% of the broadband market in the country.  While the television amount is not that large, the broadband amount may have spooked the regulators to throw out the merger.

 

However, I believe that with so much competition out there that those broadband figure is way too high.  With so many getting their content on so many different devices and with so many different services, I think that this number is wrong.

 

While many have complained that the service would have gotten worse, I believe that the combined companies would actually have improved both the quality of service and quality of how it is delivered.

 

Anyone who has been a long time reader of this blog knows that TWC has had many problems with their recent upgrades to their service.  Many times the cable boxes freezes up and must be restarted and just as often channels just come up blank requiring a reboot as well.

 

Certainly the boxes could stand a complete program rewrite.  To those who remember the old blue & white screen system may recall that rarely did the cable box need to reboot.  Ever since they changed to the black version, problems have been epidemic.

 

While I haven’t reported any recent changes to the software in the cable boxes, the only significant change that I have noticed is that the guide now can go up to about 14 days in advance for most channels even though after about 7 days, the guide just gives generic descriptions.  This is a small step forward to getting full cloud guide and DVR service, but I expect that someday it will happen.  I believe that if Comcast and TWC had worked together, the software process would have been updated more frequently and been much more stable.

 

Now there is rumor that TWC wants to merge with the smaller company of Charter Communications (CC).  Since CC is a much smaller company, I think that this merger has a much better chance of going through.

 

But before we start thinking this is a done deal, the truth is that this is a lousy deal for those who have TWC service.  From a couple of checks of different areas, the number of available HD channels and channels in general are significantly less for CC when compared to TWC.

 

Does this mean that TWC will lose many of its channels when this sort of merger takes place?

 

My answer is quite possibly and the chances are that the number will drop significantly.  However, on the plus side, the CC DVR system looks more advanced and much more user-friendly.  If we could keep the channels and get CC’s DVR service, it would be a better combination.

 

But that is just my opinion of what I would like to see happen.  Reality usually would bring us the crappy TWC system for everyone and that would be mean that we would all lose.

 

While this entire merger idea is still in its earliest phases, I am slightly optimistic that this would be more of a positive than negative.

 

In the meantime, there are 2 other mergers that may meet regulators roadblocks as well.

 

The first is the possible merger between AT&T and DirecTV.  This one like the Comcast/TWC merger may have the same problems as these are two large companies that may create a monopoly in one category or another.  I don’t see this merger happening at all.

 

The other, which I have discussed in my other blog, is the Staples/OfficeMax/Office Depot merger.  While Staples claims that such competitors are companies like Amazon and Walmart, I don’t believe that this sort of logic will hold any water whatsoever.  Yes the 3 office supply stores are dying and must do something to survive, but in reality they should just admit to their death and become part of the retail history landscape.

 

Overall, any merger of that involves large companies never have a very good chance of happening.  The government wants to keep monopolies from happening, but sometimes misses what could be something good for all involved.

 

Then again, when has the government ever gotten anything right anymore (or ever).

Taxes (What else on this day?)

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There is not a better topic on this day to talk about other than taxes.

 

Yes, taxes.

 

However, this is not about those taxes due today.

 

This is about taxes that could happen here in Maine in the coming months.  Even though these are happening in Maine, some of them may apply to other parts of the country as well.

 

Some of these taxes are disguised as fees.  One such fee (tax) applies to a new one that just started today in Portland, which makes me glad that I don’t shop in Portland.  A 5 cent charge has now been implemented on every plastic and paper bag that a shopper uses also the Styrofoam cups have been banned as well.  While I don’t have a problem with the latter, I do have a problem with the bags.

 

When I go shopping, I always try to use the self-serve checkouts whenever possible.  The reason for this is that I like to have things bagged my way, which can’t be done if some rude cashier rings you up.  I always at least double bag all my purchases as the bags never seem to be strong enough to hold much of anything before they start giving way.  So on average, I would be using about 6 bags or at a cost of 30 cents per purchase.  Do this a couple of times a week every week and it adds up quickly.

 

Of course, I hear those of you say “why not just bring your own reusable bag?”.

 

As someone who worked in retail for about 25 years, I have seen that many of these reusable bags are nasty looking.  Many look like they have been rolled in a mud puddle for hours.  Do people even ever think about washing their bags?  I don’t think so which is why I use a clean new plastic bag.  It is certainly more sanitary even though it may not be environmentally friendly.

 

This is what it all boils down to.

 

That point of being environmentally friendly.

 

Don’t these people realize that much of the garbage around town may come from those people who don’t even live in town?

 

While it may make them have that “feel good feeling”, in reality the real polluters are countries like China and India, which dump thousands of pounds of garbage into the water every day.  Portland, Maine is just a small dot in the big problem.  It may be a right step, but I feel it is a step in the wrong direction and hurt more people than it helps.  I certainly would not want to be behind someone in line who is using a dirty bag, germs are spread to easily nowadays.

 

Now while this fee (tax) has been implemented, the governor of our state has decided to create his own nightmare legacy by wanting to implement some sweeping changes to the tax bases.

 

Here are just a few of them and my comments about them:

 

  • Eliminate the state income tax. While this is a great idea in concept, how he plans on making up for it will hurt more than help.
  • Putting a tax on services like plumbers, haircuts and repairmen. Consider that some of these people rely on tips; many will see their tips reduced or disappear completely because taxes will be added to their services.  End result will be less money to those who perform services and more money to the unneeded state system.
  • Expanding and raising the sales tax to between 6 and 6.5%. This would be great if it would not hurt the ordinary state resident unlike what governor thinks that tourists would pick up the bulk of this increase.  Also doesn’t he know that tax-free New Hampshire is right next door?
  • Remove the homestead exemption tax on everyone over 65 years old. This would be great except most homeowners are younger than 65 and will get no benefit from this change.
  • Eliminating sales tax exemption for non-profits. This has been abused for years by those so-called non-profits, mostly churches and charities.
  • Lowering the corporate tax rate. This only gives company’s a fatter bottom line and unfortunately the money is not passed along to employees as a pay increase.

 

Overall, the governor’s plan is to shift the tax burden from business to its residents.  Is this a good idea?

 

Not if you want to live in Maine.

 

So if I was governor what would I do?

 

In the order listed above, my solutions would be:

 

  • Keep the state income tax. While it may seem like an outdated burden, it still raises revenue where it needs to.
  • No tax on services. I think that those who provide a service should get a tip and most who pay for those services take the tip from what they give the person at time of service.  Just a bad idea period.
  • I would lower the sales tax back to 5% or better yet lower it to 3%. Lowering the tax rate will allow more money in people’s pockets and will allow people to purchase more therefore.  The state needs to be more competitive in its rate.
  • Keep the homestead exemption for everyone. Since many homeowners have mortgages, giving them a break would be more than desired.
  • I support the taxing of non-profits. In my 25 years in retail, I saw this abused by those who were buying personal items and calling it a non-taxable business expense.  But since the information is submitted to the state regarding every tax exempt transaction and those rejected by the state are subject to the business to pay not only the applicable sales tax, but a fine as well.
  • Raising the corporate tax. While many may say this would be counterproductive to business, the truth is that many businesses have been given reductions in everything from real estate to employee benefits.  It is time that businesses really pay their real fair share.

 

 

While some may disagree with some of my plan, I think that it creates a much fairer playing field as I don’t cater to the special interests of businesses or any group.  Even if you live in another state, I think you will find that my suggestions would make for a more fair system.  If you agree with what I have written, let your representatives know or better yet run for political office yourself and influence the change of our tax system.

 

After all, shouldn’t taxes be fairer even though death isn’t?