Comcast sees little business impact from merger restrictions


Having closed the deal to acquire a 51% stake in NBC Universal, Comcast says in an SEC filing that the conditions imposed by the FCC and DOJ Antitrust Division should have little adverse impact on its businesses.

In a filing with the SEC summarizing the restrictions from the FCC Order and the consent agreement with the DOJ (and five state attorneys general), Comcast came up with an even shorter list of what’s significant than what RBR-TVBR published when the approvals were granted. Comcast listed only six conditions and said this about their potential business impact: “Although we cannot predict how the conditions will be administered or what effects they will have on our businesses, we do not expect them to have a material adverse effect on our business or results of operations.”

Here are the six areas restricting competition that Comcast spelled out in its SEC filing on Monday (1/31):
“Among other things, (i) we are required to make certain of our cable, broadcast and film programming available to bona fide online video distributors under certain conditions, and they may invoke commercial arbitration to determine what programming must be made available and the price, terms and conditions that apply;

(ii) multichannel video providers may invoke commercial arbitration to determine the price, terms and conditions for access to our broadcast stations, cable networks and regional sports networks;

(iii) we are prohibited from discriminating against cable programming networks on the basis of their non-affiliation in the selection, terms or conditions for carriage, under a standard that is comparable to existing law;

(iv) we must comply with the FCC’s open Internet rules regardless of whether these rules are invalidated in court or otherwise rescinded, and those rules will apply to any set-top box we provide that enables a customer to receive high-speed Internet services;

(v) we must satisfy various other conditions relating to our high-speed Internet services, including deploying broadband to certain unserved areas, implementing a program to improve high-speed Internet adoption among lower-income households, offering all our customers a “stand-alone” high-speed Internet service, and maintaining a high-speed Internet service of at least 12 megabits per second across most of our footprint;

and (vi) we must renew our distribution agreement with Hulu if the two other broadcast network owners of Hulu also renew their agreements, and we must relinquish all voting rights and our board seat in Hulu. These and other conditions and commitments relating to the NBCUniversal transaction are of varying duration, ranging from three to seven years.”

RBR-TVBR observation: The United States Congress may have something yet to say about the fourth restriction. If the FCC’s controversial “net neutrality” rules are voided by law, it’s hard to understand how they could still apply to Comcast, regardless of how the agreement with the FCC was worded. In fact, the congressional sponsors might see to it that the pact with Comcast is specifically eliminated by the legislation.