Meetings Multiply As FCC Vets Comcast/NBCU Draft

Comcast/NBCU, ACA, Dish, DirecTV, Bloomberg get FCC face time to talk about deal
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A flurry of ex parte filings at the FCC in the Comcast/NBCU
proceeding were posted Thursday as commissioners and their staff vetted the
FCC's draft approval of the deal and interested parties made their cases. A
commission source says there is no new draft since the initial one was
circulated just before Christmas.

For example, Comcast and NBCU execs met with top
staffers to Democratic Commissioner Mignon Clyburn on Jan. 4 to talk up its
commitment to adding 10 new minority-controlled independent nets, and
apparently to defend the eight-year timeline for doing so. According to its
filing, Comcast execs including Comcast EVP David Cohen and NBCU
General Counsel Rick Cotton explained "that the timeline for adding those
independent networks is reasonable given how long it typically takes to
identify, contract with, and launch a new network."

They also talked about their recent proposal to expand
broadband deployment and adoption. The issues of minority media ownership and
broadband deployment are among Clyburn's key focuses.

They also responded to "arguments advanced by the
American Cable Association," (ACA) without specifying what those were.

ACA got very specific in its meetings with top staffers
to Democratic Commissioner Michael Copps. According to its filing, association
President Matt Polka lead a delegation that told the FCC that a
baseball-style arbitration for carriage negotiation impasses--one of
the FCC's proposed conditions on the deal, according to the draft--would
provide no relief for small cable operators.

The FCC is also proposing to make Comcast/NBCU pay the
arbitration fee for small operators that win such arbitration, but not for
those that lose them. ACA says that "fee-shifting" proposal
looks attractive on paper, but in practice would not help their members for the
following reasons: "(1) smaller MVPDs [multichannel video program
distributors] view their odds of winning an arbitration as very low because
they cannot precisely predict the result of an arbitrators' fair market value
calculation, whereas Comcast-NBCU is much more capable of doing so; (2)
smaller MVPDs are risk adverse to having to pay their own arbitration
costs; (3) smaller MVPDs would not be reimbursed for all of its cost
related to an arbitration, particularly its internal costs; (4)
smaller MVPDs will expect Comcast-NBCU to outspend smaller MVPDs in
arbitrations as a rational and profit maximizing strategy further reducing
their chances of winning the arbitration; and (5) smaller MVPDs will be
reluctant to utilize arbitration until after other smaller MVPDs have
taken the high risk of being the first to arbitrate."

Between them, Dish and DirecTV execs met with staffers from
the offices of Clyburn, Copps and Republican Commissioner Robert McDowell,
in at least Dish's case to push for applying program access, arbitration
and standstill provisions that apply to traditional and online content alike.

Bloomberg, a big critic of the deal, also met
with Copps' staffers to push for a neighborhooding requirement--some
variation is said to already be in the draft--that would require Comcast to
place a business news competitor like Bloomberg's TV channel adjacent to other
business news channels like NBCU's CNBC.

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