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Comcast-NBC merger conditions eyed

As the proposed merger of Comcast and NBC Universal again goes under the microscope of lawmakers at a field hearing later Thursday, Stifel Nicholaus analyst Rebecca Arbogast outlined the conditions she believes will be the most relevant for regulators reviewing the deal:

  • Extending program access rules to Internet video
  • Prohibiting Comcast from tying online video access to having a cable-TV subscription (this is the model known as TV Everywhere being pushed by some paid television services such as cable and satellite.)
  • Wholesale program unbundling – so that a company doesn’t have to buy every NBC Universal MTV channel, for example, in order to get MSNBC.
  • Mandated access to key must-have assets like regional sports networks
  • Shedding assets like Hulu (NBC Universal has a stake)
  • And net neutrality conditions if other broadband providers aren’t covered in a separate open Internet proceeding being done at the Federal Communications Commission.

“Internet video and broadband conditions could be particularly significant, given the lack of current regulation,” she wrote in a report Thursday.

The conditions mirror the long list outlined by Sen. Herb Kohl(D-Wisc.) in a letter to the FCC last May.

In a blog post, Comcast Senior Vice President Joe Waz addressed questions of local competition in Chicago, where the House Communications subcommittee is holding its public hearing on the merger.

He said AT&T, DirecTV, Dish Network, WOW and RCN all compete with Comcast for broadband and paid television services in the region. And after the joint venture is completed, six of every seven channels on Comcast cable systems won’t be affiliated with Comcast.

“In Chicago, that means that out of about 190 channels in our most popular cable package, only about 30 will be affiliated with the new company,” Waz wrote.

The company has separately said many times it doesn’t believe program access conditions for its online video business is needed because the market is so new and dominated today by YouTube. It has also said net neutrality rules – which would ensure consumers get access to any legal content they want – shouldn’t unfairly fall just as a condition on the merger. If the FCC imposes such a rule, it should be done for the whole industry.

By Cecilia Kang  |  July 8, 2010; 12:04 PM ET
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How about making the cable & phone oligopolies institute ala carte pricing?-so we don't have to pay for 300+ channels! (of which 30 or so, we actually would watch)

Posted by: Hattrik | July 8, 2010 1:05 PM | Report abuse Comcast has plenty of work cut out for itself if it wishes to prove it is more than a substandard company defined by its awful customer support. Perhaps before the FCC lets the merger move forward adding to Comcast’s customer base, they should mandate that Comcast reconcile with its current customer base. If it cannot handle the scope of its current operation, it seems obvious that it will not be able to handle Comcast + NBC.

Posted by: mlschafer | July 8, 2010 6:21 PM | Report abuse

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