June 13, 2012 / 4:08 AM / in 7 years

Justice Department begins probe into cable companies: report

The headquarters of Netflix is shown in Los Gatos, California September 20, 2011. REUTERS/Robert Galbraith

(Reuters) - The Justice Department has begun an anti-trust probe into whether cable companies are acting improperly to hurt nascent competition from online video, the Wall Street Journal reported, citing people familiar with the matter.

Justice Department officials have talked to several online video providers, including Netflix Inc and Hulu, which is jointly owned by News Corp, Walt Disney Co and Comcast Corp, the paper said.

Comcast, Time Warner Cable and other cable companies have been questioned about issues such as setting data caps, limiting the amount a subscriber can download each month, the Journal said.

Cable companies have been worried that cheaper online video from companies like Netflix and Hulu would lead to customers dropping much more expensive cable TV packages, a concern that has become known in the industry as “cord cutting”.

The companies and the Justice Department all declined comment to the paper on the investigation.

None could be immediately contacted by Reuters for comment outside normal business hours.

Reporting by Jochelle Mendonca in Bangalore, Editing by Jonathan Thatcher

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