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The Federal Communications Commission (FCC) recently requested more information concerning Comcast’s plans to purchase a fifty-one percent interest in NBC Universal from General Electric Co.
The information request has a potential to delay the $28 billion dollar deal, although Sena Fitzmaurice — Comcast’s VP of Government Communications — stated that the company still anticipates regulatory approval by the end of the year.
Comcast is the largest cable operator in the country, providing service to over 23.5 million television subscribers in 2009. The company owns many popular cable networks such as E! Entertainment, and several regional sports networks that collectively form Comcast Sports Group. NBC Universal is a media and entertainment company that was formed in 2004 by a merger between NBC and Vivendi Universal Entertainment. In addition to owning numerous popular cable channels, NBC Universal also owns and operates Universal Studios and associated theme parks, and has an ownership interest in the online TV service Hulu.com. General Electric currently owns an eighty percent interest in NBC Universal.
As Fitzmaurice notes, these types of information requests “are not uncommon” in a takeover of this size. Commission rules governing media ownership prohibit any entity from owning too many television stations, or from taking up too much national television audience share. With respect to the Comcast-NBC deal, FCC has requested more information on Comcast’s distribution agreements and its decision-making process in determining what television programs to carry. The agency is also seeking information regarding NBC Universal’s agreements with cable companies to carry its channels (e.g. Oxygen), as well as the names of its top advertising partners and its advertising revenues.
The proposed merger of these two media giants has been met with considerable opposition. Critics have expressed concerns that Comcast would use its controlling interest in NBC universal to drive up prices and place popular NBC programs (such as the Office) in more expensive tiers. Further, consumer advocates fear that Comcast will limit the number of programs available on Hulu, or otherwise restrict access to the site to Comcast subscribers. Consumers Union, a non-profit organization with a mission to “test products, inform the public, and protect consumers” has released an online petition form in objection to the merger.
– Lacey R. Logsdon
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