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Must-Carry ‘No Decision’

WASHINGTON — The U.S. Supreme Court last week punted
on a decision on whether to hear Cablevision Systems
challenge to the Federal Communications Commission’s
must-carry rules.

That is according to the
list of appeals that were denied
Monday May 3, which
did not feature Cablevision
vs. the FCC.
The case had
been up for consideration
at the justices’ Friday
private conference, after
which a decision to take case or deny cases generally, but
not always, is released the following Monday.

This was one of the “not always” cases. But that still leaves
hope for Cablevision and other cable operators — the National
Cable & Telecommunications Association supported
the challenge — who argue the rules are an anachronism
in a world of multichannel, multiplatform competition.

One veteran attorney said the reason for the no decision
could be anything from one of the justices asking for
more time to check conflicts of interest, to a substantive
disagreement over taking the case. to logistical issues. .

Comcast Reporting for Duty

WASHINGTON Comcast has turned in two Federal Communications
-requested reports on its pending
NBC Universal joint venture and said 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 transaction
— in which Comcast would become the controlling
partner in an NBCU joint venture with the media firm’s
current corporate parent, General Electric — awaiting the
two reports. It has also extended the comment deadline
to accommodate reaction to the court decision overturning
its network-management ruling in the Comcast-Bit-
Torrent file-sharing case.

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 said 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. 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.”

“It’s consistent with all of Comcast’s prior filings, which is
to say: ‘Nothing is a problem, and competition flourishes,’”
Media Access Project president Andrew Schwartzman said.
“That is hard to reconcile with the ever-increasing rates
that cable operators charge and the diminishing competition
in the video programming marketplace.”