December 8, 2009

ACA Wants Close Scrutiny of Comcast-NBCU Deal

The American Cable Association is urging regulators to scrutinize the proposed Comcast-NBC Universal transaction and take appropriate action, whether through conditions or forced divestiture, to prevent the new programming giant from using its enhanced market power to raise prices and limit choices for consumers of small and medium-sized cable and broadband operators.

"Without broad government intervention, regulators in Washington, D.C. will see Comcast-NBCU wield its unprecedented power to drive up artificially the cost of its programming, particularly for its newly acquired local broadcast TV stations and its 'must-have' national and regional cable networks that air live sporting events," said ACA President and CEO Matthew M. Polka in a statement. "Without restrictions, the new media conglomerate will also leverage its enhanced market power to force other pay-television providers to distribute all of its combined Comcast-NBCU programming on basic tiers, regardless of consumer interest in paying for this content."

Under the proposed transaction, Comcast would take majority control of the NBC broadcast network, 10 local NBC TV stations and 16 TV stations owned by the Spanish-language Telemundo network, and the Universal movie studio. The deal would also put Comcast in command of NBCU's cable programming assets, including USA, Syfy, CNBC, MSNBC, Bravo, Weather Channel, Oxygen, Chiller, Sleuth, Telemundo, Universal HD, and mun2. These NBCU cable programming assets would be combined with Comcast's stable of cable networks, which includes Golf Channel, E! Entertainment Television, Style Network, and VERSUS.

At the close of the transaction, Comcast - already the owner of 10 regional sports networks — would gain enormous new clout in the sports TV market as NBCU already has the rights to the Olympic Games and the rights to air regular season NFL games on Sunday night.

In addition, Comcast is the country's largest cable TV service provider, with 23.8 million subscribers, and the largest residential broadband access provider, with 15.7 million customers. It also provides digital phone service to 7.4 million customers.

In the online arena, Comcast would assume NBCU's 30 percent interest in Hulu.com, the Internet video streaming site that is free to broadband access providers and their consumers who want to sample some of NBC's primetime fare in an on-demand fashion.