News

Reps Want Merger Action

8/09/2010 12:01 AM Eastern

Washington — The Federal
Communications Commission and
the Justice Department are getting
some pressure from Capitol Hill to
make sure the vetting of Comcast’s
proposed NBC Universal joint-venture
deal doesn’t go past year-end.

That would be just fine with
both companies, whose executives
have said they are still hopeful
that deadline can be met.

While Congress was running
for the exits for its August break
last week, a dozen House members
paused long enough to profess
their public support for the
deal and press their case for not
dragging out the review.

The highest-profile supporter was
Rep. Rick Boucher (D-Va.) chair of
the House subcommittee with oversight
authority over the FCC.

DEC. 1 TIMETABLE

The upside for Comcast in Boucher’s
support was that it came with
a suggested deadline of Dec. 1,
which would allow the deal to
close by the end of the year — or
the beginning of 2011, depending
on how Comcast wants to handle
consolidation of the two companies’
earnings statements.

The potential downside is that
Boucher’s approval was at least
linked, if not contingent, on a
number of conditions that would
effectively apply the programaccess
conditions for traditional
video to online video.

Comcast executives have signaled
that they realize online access
is going to be part of the
conversation on the deal — which
would combine Comcast Entertainment
Group with the current
NBCU in a Comcast-controlled entity
— and have not ruled out being
part of that conversation. They also
warn that both Comcast and NBCU
would resist conditions that interfere
with its business operations.

In letters to the FCC and the
Justice Department, Boucher, the
House Communications Subcommittee
chairman, asked both entities
to approve the $30 billion joint
venture, and recommended applying
conditions on access to video
programming online.

He also urged the FCC and DOJ
against applying a merger-specific
network-neutrality condition,
saying “it would be highly
inappropriate to impose network-
openness requirements on
a single broadband provider.”

It was not clear if Boucher’s
support was contingent on all or
some of those conditions. His letters
did not directly tie the conditions
to his support. Calls to his
office seeking clarification had
not been returned by press time.

One veteran communications
attorney, speaking on background,
said that the key to the Boucher
conditions would be in the interpretation
in “close cases” and how
long the conditions would be in
eff ect. “If the transition to online
viewing is faster than the current
rate,” he asked, “when would the
conditions end and what would be
the means for modifying them?”

Free Press, which opposes the
deal without strong conditions on
access to programming and other
issues, chose to emphasize the
conditions rather than the support.
“We read Boucher’s support
as conditional because he proposes
conditions for approval,” Free
Press media coordinator Jenn Ettinger
said.

HOMETOWN HUG

What was not conditional was the
support from 11 House members
from New York — hometown rooters,
so to speak, for NBCU.

Those 11 members, including
Democrats Eliot Engel, Ed Towns
and Steve Israel and Republican
Chris Lee, said in a letter they recognized
that large companies
needed government scrutiny when
they get together, but such a review
should not “drag on indefinitely.”

In contrast to Boucher, they emphasized
the work that had already
been done by Congress, the FCC
and the companies and did not request
additional conditions.

They cited numerous Hill hearings
on the merger; public-interest
promises and intervening side
deals with producers, affiliates
and minority groups; and a marathon
FCC hearing in Chicago on
July 13 as evidence that the deal
has been fully vetted.

At press time, the list of Hill fans
was growing. Comcast provided
copies of letters from two dozen
African-American and Hispanic
members of Congress asking the
FCC to approve the deail with the
Hispanic legislators adding that
the FCC should provide that approval
before year-end.

BOUCHER’S NO-NO LIST

WASHINGTON — Rep. Rick Boucher (D-Va.) voiced support for Comcast’s
proposed joint venture to control NBC Universal (now owned by General
Electric), but said the FCC should prevent the companies from:

• Migrating any shows now delivered over the NBC broadcast network
to a “TV Everywhere” platform that would require a cable subscription;

• Entering into exclusive online deals for programming in which the
companies have an attributable interest;

• Blocking access to competitors’ video programming;

• Migrating NBC broadcast sports events to cable-exclusive play
(essentially incorporating an agreement Comcast has already made
with NBC affiliates);

• Preventing programming in which they have a fi nancial interest
from being played on any Internet-enabled device, unless that
device would compromise the look, function or copyright protection
of the service.

SOURCE: Multichannel News research