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Labor, public interest, media protest Comcast-NBC Universal merger

A labor union, public interest groups and media firms wrote a letter to regulators Monday, protesting the merger of giants Comcast and NBC Universal, saying that as proposed today the unified company could disadvantage other media and communications service giants and stifle the burgeoning market for video viewed over the Internet.

Free Press, Communications Workers of America, Bloomberg and Media Access Project were among several organizations who wrote to Justice Department antitrust chief Christine Varney and Federal Communications Commission Chairman Julius Genachowski saying the merger poses too many risks to competition, could end up costing media consumers more, and lead to job losses.

“As the largest cable company, the largest residential broadband Internet service provider, the owner of one of the four national broadcast networks, owner of the local NBC stations in some of the nation’s largest media markets, owner of several national, regional and local news, entertainment and sports cable networks, and owner of or major investor in some of the most heavily visited websites on the Internet, the merged entity will exert a degree of market power unrivaled in our nation’s media history,” the groups wrote.

Specifically, they said the merged company will have the incentive to jack up fees for competitors who want access to NBC or Comcast shows and movies. Those increased program rates would trickle down to consumers warned. They also urge the regulators to address how Comcast, the nation’s biggest broadband Internet service provider, could wield its size to shut out smaller online competitors. Apple and Google are working on Internet video platforms. Netflix, Boxee and Vuze are also streaming video over the Web.

“By combining NBCU’s key programming assets, including 10 NBC local broadcast stations and numerous popular NBCU national cable networks, with Comcast’s 10 regional sports networks, this new programming behemoth will have unparalleled market power to demand higher prices from cable and satellite operators whose added costs will be passed along to consumers,” the groups wrote.

Comcast has said current programming rules would prevent the merged company from withholding NBC content or charging more for it. And it has warned against rules for online video competition because the market is too young to regulate.

Comcast and NBC Universal’s proposed union is expected to be complete regulatory review at the Justice Department and FCC by the end of the year or early next year.

Senator Herb Kohl (D-Wisc), chairman of the judiciary subcommittee, sent a letter to Varney and Genachowski last month recommending several conditions if the merger is approved to ensure consumers are protected. Among the conditions was that NBC Universal and Comcast’s library of content be made available to any competitor. Kohl also urged the regulators to require Comcast-NBCU to divest its 32 percent stake in online video provider Hulu and ensure it would not block competitors like Apple’s iTunes, Boxee, or Vuze from carrying those shows over their own platforms.

By Cecilia Kang  |  June 21, 2010; 7:00 AM ET
Categories:  Antitrust , Apple , Broadband , Comcast , Consumers , DOJ , FCC , Media , Online Video  
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Comments

They make a strong case for not allowing this merger to happen, it certainly appears to be anti-consumer.
Ever since Comcast buught out the local cable company in my hood, cable & interent rates have consistently gone up. And with only one other cmpetitor to choose from, I dont' see this merger as a benefit to the Comcast customer, or the cable & internet market, in general

Posted by: Hattrik | June 21, 2010 9:25 AM | Report abuse

Nice article and I praise the journalist that wrote it. You only missed the elephant in the room. That is the FACT that these corporations own our government, lock stock and barrel and when the time comes the FCC will do what it's told to do like a nice little corporate owned entity. Want to place a friendly bet on whether or not the merger is approved and that within 5 years ANY imposed "special" rules will be done away with?

Posted by: bcreek1 | June 21, 2010 2:44 PM | Report abuse

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