Washington

Comcast-NBCU: Republicans Warn Against Letting Conditions Sidetrack Approval

House staffers urge Republican legislators to neutralize regulators, competitors, "public interest" groups 2/02/2010 06:04:00 PM Eastern

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.

October
November