News

A Merger, An Opportunity

2/06/2010 2:00 AM Eastern

You have to sympathize with legislators and regulators reviewing Comcast's takeover of NBC Universal's programming assets.

Is it about even more over-concentration of media in a few corporate hands?

Is it about correcting abuses that already exist from that over-concentration? Is it about protecting consumers against gatekeepers extending their walls around future media?

It's all that and more. But more importantly, it's about what can reasonably be accomplished via conditions to a merger even opponents (such as the American Cable Association) concede will likely go through. That is a challenge and an opportunity.

Comcast tried to circumvent the opposition by volunteering to abide by existing rules governing access to programming controlled by distributors, even if challenges to those rules (by companies including Comcast) led to their elimination.

Comcast also promised to maintain free over-air broadcasting by NBC and Telemundo as a hedge against multichannel hegemony.

Clearly, Comcast is going to have to do more.

Sen. Herb Kohl, a Wisconsin Democrat, scorned the promises as hearings on the merger opened Thursday. He said this merger would likely mean other providers would have to pay more to get Comcast-owned programming, if it's available at all. He called for tough conditions. Added former NBC employee Sen. Al Franken (D-Minn.): “You will excuse me if I don't trust those promises.”

Colleen Abdoulah, a former cable executive running an “overbuilder,” WideOpenWest, testified in the House that program-access complaints now can take years before they are acted on, amounting to “a right without a remedy.” She wants program-access conditions in the merger clearly spelled out — on “most favored nation” terms, without buy-through or bundling terms — and wants third-party binding arbitration as an option when disputes arise.

The Federal Communications Commission, in its recent action limiting cable's use of the “terrestrial exemption” to withhold must-have programming, has signaled a willingness to do more to extend access to programming. Comcast can expect more of the same to get this merger approved.

Consumers can hope conditions tacked on to this merger will help them continue to get the programming they want, at prices not artificially inflated by overly powerful gatekeepers.

March