Comcast-NBCU: Republicans Warn Against Letting Conditions Sidetrack Approval

House staffers urge Republican legislators to neutralize regulators, competitors, "public interest" groups

By John Eggerton -- Broadcasting & Cable, 2/3/2010 6:04:12 PM

Republican staffers on the House Energy & Commerce Committee weighed in with their own memo in advance of the Feb. 4 Comcast-NBC Universal merger hearing, warning Republican members not to let regulators, competitors or "public interest" groups (italics theirs) "to extort from Comcast and NBC Universal a wish-list of conditions they have failed to justify as industry-wide regulations."

That follows yesterday's memo from Democratic staffers talking about all their concerns about the deal's potential anticompetitive effects.

The Republicans are looking at the same deal but see it quite differently. "No condition is warranted unless it is narrowly tailored to a transaction-specific harm to competition," the staffers wrote, according to a copy of the memo. "Since the deal will not materially increase horizontal concentration in either the distribution or programming markets, demonstrating such harms will be difficult, especially in light of the robust competition in the video sector."

 Comcast has argued that its share of the online video market is miniscule and that the overall market is extremely competitive.

"As competitive as this market is, regulatory intervention is not only unnecessary, it will hurt competition and consumers, especially in this economy," wrote the Republican staffers. "The longer the review takes, the longer the fate of NBC Universal, its employees, and its viewers will hang in the balance."

Those "public interest" groups have been urging the FCC and Justice to take their time with the review and pay particular attention to access to online video, which they argue the new company would have the ability and incentive to restrict in favor of their own platforms.

Reading from the same page as Comcast, the Republicans advise that the deal is unlikely to have any competitive impact since the two companies' markets do not materially overlap. They echo Comcast's point that none of its cable nets are in the top 30 most highly rated and have only a fraction of the cable ad market.

They argue that Comcast's vertical integration is not an issue because the combined company will not have market power in either programming or distribution.

The Republicans argue that NBC will still have to compete with at least three other broadcast networks with affiliates in almost every market, and Comcast will still be competing against DirecTV and Dish, as well as cable overbuilders and telcos.

They argue against any network neutrality provision, saying it would hinder investment and would not be transaction-specific since "nothing in the deal would increase Comcast's market power over broadband."

To round out the shout-out to Comcast-NBCU, the Republicans advise against any conditions on retransmission consent, program-access or access to regional sports. They also say the company has already volunteered sufficient public interest obligations, including ones that address access to programming and program diversity.