Comcast To FCC: Reject ACA's Call For Merger Conditions

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Comcast has told the Federal Communications Commission to reject the American Cable Association's calls for program-access and retranmission-consent conditions on its proposed joint venture with NBCU, saying they are "wholly unjustified."

In a filing at the commission, the top cable operator said that, as it has demonstrated in "extensive filings" and economic reports, the transaction "poses no cmopetitive harms" that need addressing through such conditions, that ACA's arguments are simply a "rehashing" of its previous calls for industry-wide changes, and are thus neither narrowly tailored or transaction specific.

ACA's proposed conditions, which have been endorsed by an alliance of small telcos, including the National
Telecommunications Cooperative Association and the Organization for the Promotion and Advancement of Small
Telecommunication Companies, would apply program-access rules to all TV stations, owned or managed by
NBC, as well as to all regional sports nets (RSNs) delivered either by satellite or terrestrially and to online distribution; unbundle TV station retrans deals from other carriage agreements and do the same for RSNs; invoke outside arbitration for retrans impasses and special arbitration for the smaller operators ACA represents; and implement standstill agreements so NBC stations cannot remove signals during retrans impasses.
Comcast argued that ACA's wish list is essentially a recitation of its general advocacy for changes to the program- access and retrans regimes, and that when they do differ, the conditions are not transaction-specific.
"In short," said Comcast, "ACA's effort to paint its proposed conditions as tied directly to the transacdtion are belied by the fact that...those conditions are part of a pre-existing, industry-wide, and long-standing program-access agenda..... [T]he commission should not impose such conditions in this transaction proceeding," the company concluded.

ACA has argued that most of its conditions are similar to those imposed in other vertical transactions--ones uniting primarly complementary assets--production plus distribution, for example, rather than competitive ones (horizontal) -- including Adelphia-Time Warner-Comcast and News Corp.-DirecTV. Wherethey are new conditions, ACA argued, they are meant to address problems assocated with the conditions on those prior mergers, or to address "horizontal" harms in combining video programming assest that were not involved in either of those two previous mergers.

Relative to retrans conditions, ACA president Matt Polka thinks the FCC should not wait for the Comcast/NBCU merger to drive that stake in the ground. In a "mincing-no-words" statement on the Fox/Cablevision impasse, he said Fox was exploiting a "shattered" retrans system and called on the FCC to use broad statutory authority to restore Fox signals to Cablevision and order arbitration.

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