WOW! Chief Says Whoah!: Add Strong Comcast/NBCU Conditions
Abdoulah Says Government Must Consider Divestitures, 'Behavioral' Remedies
John Eggerton -- Multichannel News, 2/3/2010 10:11:41 AM
Colleen Abdoulah, president of video/broadband provider WOW!, plans to tell a Capitol Hill audience that the Federal Communications Commission and the Justice Department will likely need to put serious conditions on the Comcast/NBCU merger to prevent it from "beating the system" and engaging in anticompetitive conduct.
Colleen Abdoulah of WOW via C-SPAN
That's according to a copy of her testimony for the Feb. 4 hearing in the House Communications & Internet Subcommittee.
Speaking for the overbuilder, as well as the American Cable Association, which represents small and mid-sized operators, Abdoulah argues that the current program access rules are essentially a "right without a remedy," and that the government must consider structural relief -- like forced divestitures -- in addition to as various "behavioral" remedies.
Rather than being a primarily vertical deal, as the companies argue, Abdoulah says that it "greatly increases" horizontal concentration by combining "key content and distribution assets" of the two.
Comcast and NBCU have volunteered a number of conditions related to access, program diversity and nondiscrimination, but Abdoulah argues the concessions are superficial and "provide neither material certitude of program access nor assurance of a level playing field."
Comcast/NBCU argue that their broadcast and cable assets are separate spaces, pointing out that there is no cable substitute for a network affiliated station, for example.
Among those remedies: nondiscriminatory rates and terms for all Comcast/NBCU content, on-air, on wire or online; prohibitions on bundling, tier or penetration requirements; and third party arbitration and review for any program access complaints.
But Abdoulah does leave a path for approval of the deal. "[I]f the federal agencies address the grave potential harms with robust relief...incumbent entrepreneurs will expand their businesses and new ones will rush into the market - all to the benefit of American consumers."
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