Rupert Murdoch and company have some homework to turn in before they find out whether the FCC will give them a passing grade on their effort to acquire DirecTV.
The next step in securing government approval for his bid to control Hughes/DirecTV is for News Corp. and the DBS provider's current owner, General Motors, to answer 10 pages of questions from the commission about how the deal will enhance DirecTV service. The FCC also wants assurances the transaction won't diminish competition in the satellite-TV and TV-programming markets.
News Corp., which has promised to impose safeguards to prevent its using DirecTV as leverage to lift prices of programming it sells to cable and DBS competitors, must identify each of its U.S. multichannel programming networks and its subscription and ad revenue. It must also identify its U.S. broadcast channels, along with pay-TV carriage terms and ad revenue. And it must provide details on its electronic programming guide and interactive services.
News Corp. also was asked to detail its plans to carry local broadcast channels, including in high-definition.
Hughes was asked to describe its ownership interest in programming powerhouse Liberty Media and whether there is an agreement to acquire a larger stake in the future.
In addition, the companies were asked to spell out their criteria for selecting independent Hughes directors.
The questions appear designed to investigate charges by Murdoch's critics that the deal will allow him to dramatically increase the cost of Fox pay-TV channels, a move that could lead to dramatically higher prices for pay-TV subscribers.
The FCC inquiry did not go far enough for Center for Digital Democracy's Jeff Chester, however, who said the request "failed to specifically ask the parties how such a transaction will offer meaningful competition to cable, including on monthly subscriber rates."
News Corp., Hughes and GM were given until Aug. 6 to respond.