A panel of the Senate Judiciary Committee is calling on the Justice Department to impose major conditions before approving Comcast’s $30 billion bid for NBC Universal.
One condition it wants: a guarantee NBC and Comcast will carry more programming from independent producers.
It also asks regulators to bar Comcast from:
— selecting its own or NBCU’s channels over rivals for distribution on cable;
— discriminating against programmers who offer their content on the internet;
— migrating NBC programming to cable for 10 years.
In a letter to Justice’s antitrust chief Christine Varney and to the Federal Communications Commission on Wednesday, Sen. Herb Kohl, D-Wis., said that in three areas — competitors’ access to NBC programming, the ability of independent programmers to get their shows aired, and the web airing of TV shows — the committee found the deal presents “troubling concerns.”
“We appreciate Comcast’s and NBC’s position that this acquisition will promote public interest ‘by increasing the quantity, quality, diversity and local focus of video content’ and enhance competition by making Comcast and NBC ‘stronger, more effective players’ in video programming,” said the letter.
“Nonetheless our examination of this transaction has led us to conclude that Comcast’s acquisition of NBC Universal has the potential for serious anticompetitive and anti-consumer effects.”
In a statement in response to the letter, Comcast called the deal "pro-competitive."
"This partnership is pro-competitive, pro-consumer and in the public interest. Together Comcast and NBCU will enhance the entertainment experience through bold innovation and expanding consumer choice. We expect a thorough and expeditions regulatory review and that any conditions will not unduly burden either Comcast or NBCU’s businesses,” said the statement.
Kohl’s letter also said one of the concerns is about how the deal might impact “the ability of unaffiliated and independent programmers to gain access to the combined Comcast/NBC platform.”
“I share the concerns raised by independent programmers that after Comcast acquires NBC programming, it may be even more difficult for them to get carriage on Comcast, carriage that they believe is essential to enter the programming market,” wrote Kohl.
He said while “Comcast asserts it would have no incentive to block the launch of compelling independent programming,” the acquisition of NBC’s assets “would give the combined entity more opportunities and greater incentive to engage in illegal discrimination against non-affiliate programmers."
“Therefore," the letter said, "meaningful requirements related to program carriage must be a condition to approving this merger.”
Kohl said that the internet also is a major concern.
He said Hulu – 32 percent owned by NBCU — is a competitor to Comcast’s Fancast.com and to Comcast’s cable service, and he rejected Comcast’s contention that internet video programming is too nascent to scrutinize.
Instead, he warned that the deal has the potential to remove the web as a cable competitor and also opens the possibility that Comcast could use its greater distribution clout to keep content off competitors' platforms.
“It is clear that video over the internet has the real potential to become a strong competitive alternative to traditional [cable] providers and to offer consumers new choices to obtain cable programming without expensive [cable] subscriptions,” said the letter.
“Comcast will have the incentive to exercise its influence as a part owner of Hulu to ensure it does not become a competitive threat to Comcast’s cable television services,” the letter said.
Kohl also expressed concerns about whether Comcast would deal fairly with rival cable, phone and satellite providers who want to retransmit NBC stations. His letter asks that regulators require Comcast to agree to binding arbitration of retransmission disputes.
