Madison Ave. Likes Comcast/NBCU Fit

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Comcast should finally get its arms around NBC Universal next week, but Madison Avenue is already embracing the combination of content with distribution technology.

After the deal received regulatory approval earlier this week, General Electric Friday said it expected it to be completed Jan. 28. GE also said that NBCU’s fourth quarter profits jumped 38%. (You could almost hear NBCU’s outgoing Jeff Zucker telling his replacement, Steve Burke, ” top this.”)

Ad buyers are looking forward to being able to have conversations about the future with NBCU executives, who have mostly been closed-lipped pending regulatory approval of their new bosses. But mainly, they think it’s a future to they’re looking forward to.

“I can’t imagine that this is not a sign of good things to come, especially from a content standpoint,” says John Muszynski, chief investment officer at SMGx. “I think  that you’re going to see a renewed interest in pushing the product, and that’s only a good thing for viewers and for advertisers alike.”

The merger also promises to advance the linkage of technology to programming and advertising.

“There’s been a reluctance to move some of these forward because they don’t want to rock the boat on discussions that are happening in Washington regarding net neutrality and behavioral targeting,” said Tracey Scheppach, senior VP and innovation director at SMGx. “There’s a whole litany of things that applications and addressability open up that they’ve been gun shy to do much about. So I’m interested if they’ve been hunkering back and working or if they’ve just been waiting.”

Scheppach expects Comcast to be aggressive with technology. “I think you’re going to see them up their game on things like TV Everywhere. We’ll see if that translates all the way down to VOD,” she said. ” You can even see things like they were announcing at CES. They’re getting into this converged world, whether it be offensively or defensively because they’ve got to get there, otherwise it will get away from them.”

Comcast will also be more likely to include advertisers in their plans than some other technology companies. “Just getting the advertising in the discussion is a major feat with the Netfilx and the Steve Jobs of the world, where it’s all a la carte or subscription. Where are the ads? Steve [Burke] approaches it a lot more friendly and open and he financially cares as well, so a lot of points are lining up through this closing,” Scheppach says.

While others pushed for conditions to be placed on Comcast and NBCU, there was little pleading by the ad industry.

Chris Geraci, managing director for national broadcast at OMD, noted that Comcast and NBCU had very different assets, particular when it came to national television. “The combination of them really doesn’t create a concern about the amount of leverage they have  in the marketplace. I know that was a concern going in, but I never really saw It that way.”

The vertical combination offers more promise. “I do think it’s great that we’ve got what I would consider to be one of the leading technology companies, when it comes t bringing entertainment and media to the home, combining with a major producer of content,” he said

But Geraci noted that no matter what type of advanced advertising products Comcast develops, its footprint still doesn’t reach critical mass for national advertisers. “To do what some folks say that this will usher in is still going to be limited just  to their homes unless there’s the cooperation of other entities and other distribution,”  he said. “I think that they could become a market leader, let’s say, In addressable advertising , in VOD and all sorts of stuff where you really need the technology and vertical integration to be part of it.”

Geraci expects  Comcast to “do what it takes” to improve program development at NBC. “You could make the argument that some of the cable assets they bought are doing proportionally even better than the broadcast network.  Maybe they’ll just make some other decisions about where certain programs should run,” he said. “But I’m sure they’re keen to make NBC something performance-wise better than it is now, especially with scripted development  and those things where you really have to take a long term view and invest.”

Comcast is installing veteran leaders on its sales team, with Comcast Networks sales head David Cassera in charge of cable and Marianne Gambelli of NBC in charge of broadcast network sales.

“From a sales perspective, I don’t see this as a huge disadvantage to us because now they’re all under one roof,” says SMGx’s Muszynski.  “Actually I see this merger as bringing together some of the best talent in the sales industry. You’ve got Cassaro now running all of the cable, that’s huge plus for all of the NBC cable entities that they get to have his leadership. And they didn’t lose anything-they’ve got Gambelli running the network side still.”