DirecTV: FCC Arbitration Condition Should Be Unbundled As Part Of Comcast-NBCU Approval


DirectV has asked the FCC to unbundle its arbitration condition as part of granting approval of the proposed merger of Comcast and NBC Universal.

The top DBC provider says that "requiring arbitration of multiple, bundled networks would significantly increase the complexity and cost of an arbitration proceeding, and thus wouldundermine any efforts to streamline the process to make it a more affordable and expedited remedy for all concerned."

That came in a phone conversation last week between a DirecTV lawyer and Rick Kaplan, advisor to FCC chairman Julius Genachowski, according to a filing at the commission.
DirecTV was responding to a draft approval of the deal circulated to commissioners. According to a source, the
program-access condition arbitration requirement refers to bundles of service. However, the DBS operator averred that if the FCC does not require unbundled bids in so-called baseball-style arbitration -- where each side submits its best offer -- "it is hard to imagine how an arbitrator would go about determining which party's proposed terms and conditions for  carriage best represented the fair market value of up to 15 Comcast/NBCU networks at a single time - even assuming that both parties submitted offers on the same bundle," according to DirecTV counsel William Wiltshire in the filing.
Wilshire also suggested that allowing bundled bids "would effectively institutionalize the very sorts of program tying
practices that have raised concerns in other proceedings."

The FCC commissioners are currently vetting the draft, which Genachowski supports and circulated, though he has not voted the item yet.