Comcast has turned in two Federal Communications Commission-requested reports on its proposed NBCU joint venture and says they confirm its earlier assertions about the deal's public interest benefits and its lack of adverse impact on online video distribution.
The FCC stopped the clock on its review of the merger awaiting the two reports. It has also extended the comment deadline to accommodate reaction to the court decision overturning its network management ruling in Comcast/BitTorrent.
According to a letter submitted to the FCC along with the reports, Comcast quotes Dr. Gregory Rosston from his economic analysis of the deal, as concluding it "is likely to result in synergies and changes in incentives that will stimulate increased investment by Comcast in programming and distribution, and this, in turn, will broaden and accelerate innovation in video distribution platforms...and increase the quantity, quality, and convenience of video viewing by viewers."
The other report, on online video distribution, by Drs. Mark Israel and Michael Katz, confirms, says Comcast, that "the proposed transaction does not threaten competition in the distribution of long-form, professional-quality video programming, notably the provision of such programming via the Internet."
The report says that as long as online video is a complementary service to traditional multichannel video delivery, there is "clearly no basis for concern" that Comcast could "foreclose" online video competitors, but it goes further, saying that even if online were to become a viable competitive substitute, the deal would not "enhance" the economic incentive for Comcast to deny NBCU programming to competitors.
Comcast adds in a footnote to that point that under the terms of the joint venture, the directors and officers would violate their fiduciary duties if they "made business decisions that intentionally sacrificed joint venture profits in order to increase Comcast's MVPD profits."