Comcast, NBC say deal would not hurt competition

Jan 28, 2010 By JOELLE TESSLER , AP Technology Writer

(AP) -- Comcast Corp. and NBC Universal said the cable TV operator's plan to take control of the NBC media empire shouldn't raise significant antitrust concerns because the companies operate in separate and highly competitive markets.

In a 136-page document filed Thursday with the , Comcast and NBC said the proposed deal is a "vertical transaction" that would not hurt competition in either the media or the content distribution business.

Instead, they said, the combined company would be in a better position to challenge rivals in both markets - including media companies such as Inc., Viacom Inc. and Walt Disney Co. and other subscription TV providers, including satellite and phone companies.

"Viewed from every angle, the transaction is pro-competitve," the filing said. "The programming and distribution businesses are each highly dynamic and competitive, and becoming more so every day."

Comcast, the nation's largest cable company, is seeking approval from the Justice Department and the FCC to acquire a 51 percent interest in NBC Universal from Co. The government reviews are expected to take up to a year.

The companies filed paperwork on Monday with the Justice Department, which will examine the antitrust implications of the deal, although that document has not been made public. The FCC, which must approve the transfer of the NBC broadcast licenses, will take a broader look at the public interest ramifications. Congress has also scheduled hearings for next week.

The federal reviews are expected to focus on the potential dangers of allowing one company to own so much popular media content and such a large content distribution operation.

Comcast has nearly 24 million cable customers and nearly 16 million broadband subscribers. It also owns some cable channels, including E! Entertainment and the Golf Channel, and has a controlling interest in the Philadelphia 76ers and Flyers sports teams. Comcast's SportsNet Philadelphia channel carries Flyers, Phillies and 76ers games.

NBC Universal owns the NBC and Telemundo broadcast networks; 26 local TV stations; popular cable channels such as CNBC, Bravo and Oxygen; the Universal Pictures movie studio and theme parks; and a stake in Hulu, which distributes TV programming online.

Satellite companies and other rivals in the video business are particularly concerned that the combined company could drive up prices for - or even withhold - popular national and local programming, including NBC television broadcasts and regional sports. And small independent programmers worry that Comcast cable systems could stop carrying channels that compete with its own, or relegate rival channels to premium tiers with fewer subscribers.

Regulators will also likely look at fears that the company would have too much power in local markets where it would own both the NBC affiliate and the dominant cable system, and that Comcast would begin charging for media content online.

In their FCC filing, Comcast and NBC said the combined company would be able to provide more and better local programming. They promised an additional 1,000 hours of local news and information programming a year on the local NBC stations that Comcast would acquire.

The companies also said the combination would lead to a more diverse range of programs. Unlike many other media consolidations, the companies added, Comcast's proposed acquisition of NBC would not reduce the number of media outlets or voices.

The companies pledged an additional 1,500 programming choices for children and families on Comcast's Video On Demand service and said they would use additional broadcast spectrum made available from the switch to digital signals to show an additional hour of children's programming each week and more Telemundo programming.

and NBC also said the combined company would be in a better position to experiment with new ways of delivering content to consumers, including on the Internet and on mobile devices.

The new company "will promote the public interest by increasing the quantity, quality, diversity and local focus of video content and accelerate the innovative 'anytime, anywhere' future that Americans want," the FCC filing said.

The filing also reiterated the companies' promises to continue free, over-the-air broadcasts of the NBC and Telemundo networks and to add new two new "independently owned and operated" channels to Comcast's digital cable lineup each year for three years.

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Caliban
1 / 5 (1) Jan 28, 2010
Successful competition results in the elimination of competitors(one way or another), or at least a reduction in their numbers. Then where does the "competition" come from?