Comcast/NBCU Venture Could Draw Washington Scrutiny


What obstacles might a Comcast and NBC Universal joint venture have to clear in Washington?

If the nation's top cable operator did take a controlling interest in NBCU and its TV stations, that would mean a long-form review of the deal at the Federal Communications Commission, which must approve any transfer of TV licenses, as well as an antitrust review at the Justice Department.

There are no FCC regulatory roadblocks to such a deal  -- the FCC repealed its rules preventing co-ownership of cable systems and TV stations back in the late 1990s. But there could be hurdles to the combination of a studio and top cable operator from a Democratic administration that has vowed more merger scrutiny.

Comcast is the country's largest distributor with over 24 millions subs, according to Kagan figures from March

A number of industry vets said that the FCC would likely put some conditions on the merger of a studio and MSO -- as there were when News Corp. bought DirecTV  --  to make sure independent programmers were not disadvantaged by the vertical integration of studio and distributor.

Stations in markets where Comcast has cable systems and TV stations might ask for conditions barring discrimination in carriage terms in retransmission-consent negotiations, said one veteran communications attorney.

The companies could also get out in front of that process by coming to the FCC with their own proposals of conditions.

Another tack might be to spin off the stations or even the cable networks. Time Warner has received props in Washington for its arm's length separation from its cable operations.