Posted by chicagomedia.org on November 04, 2009 at 13:02:56:
Comcast-NBC deal may pose regulatory questions
If it comes to pass, acquisition would pose questions as to whether it's in public interest
Phil Rosenthal
Tribune Media
November 4, 2009
After more than 60 years as an NBC-owned-and-operated station, it's possible WMAQ-Ch. 5 could be put up for sale if Comcast is successful in its bid to acquire control of NBC Universal from General Electric.
Formal prohibitions on owning both a cable system and a broadcast outlet in the same market went away with the Telecommunications Act of 1996.
But the Federal Communications Commission still conducts a review of such mergers to determine whether it's in the public interest before signing off on a transfer of broadcast licenses.
Some argue that, in an age of ever-expanding digital media options, it is difficult, perhaps impossible, for any one entity to have too much control of information, as long feared by Big Media opponents.
But a marriage of these media behemoths would offer opponents of media consolidation a golden opportunity to reopen that debate, especially with a potentially sympathetic Democratic administration now in the White House.
NBC Universal's assets include broadcasting, cable networks, movies and theme parks. Comcast provides Internet access and phone service as well as cable TV service, in addition to owning national and regional cable networks.
Here in Chicago, Comcast is the dominant cable system. Other markets with NBC-owned stations where Comcast has enough cable penetration to potentially raise eyebrows include Philadelphia; Miami; Washington, D.C.; Hartford, Conn.; and the San Francisco Bay area.
The merger proposal on the table reportedly calls for Comcast to pick up about 51 percent of NBC Universal, while moving the cable networks it owns such as E! and Versus under the Peacock banner. General Electric, which owns 80 percent of the company, would retain 49 percent, at least initially.
One possible stumbling block, however, is negotiating a deal with French conglomerate Vivendi, a 20 percent stakeholder in NBC Universal since the 2004 merger with Universal Entertainment. Assuming Vivendi doesn't blow up the transaction, regulatory approval would be required next.
Those seeking government approval for such deals have been known to answer objections by signing off on certain restrictions.
Rupert Murdoch's News Corp., for example, allayed fears in 2003 over the owner of Fox Broadcasting Co. acquiring satellite service DirecTV. It agreed not to pull its programming off cable providers as a negotiating tactic over fees with companies such as Comcast. (News Corp. has since sold its DirecTV interest.)
Besides, insiders say it might make sense for Comcast to want to shed not only NBC's TV stations but the NBC broadcast network, anyway. They note the chief moneymakers in NBC Universal's TV portfolio are the cable networks, which include USA Network, Bravo, SyFy, CNBC and Oxygen.
One source said that if the stations and broadcast network were spun off, cable's MSNBC might have to go with them because it is so closely tied to NBC News.
Obviously, there are plenty of "ifs" in all this.
But the entire media business is going through big changes, and NBC, once known for such gold-standard dramas as "ER" and "Hill Street Blues," now fills much of prime time with Jay Leno and reality programs a la "The Biggest Loser" and "America's Got Talent."
If the NBC owned-and-operated station that was born as WNBQ in 1948 and has had a regular broadcast schedule since Jan. 7, 1949, were no longer owned and operated by NBC, viewers will get used to that, too, eventually.