What Does the Comcast-NBCU Merger Mean for Business?: Part 1

After receiving approval from antitrust regulators with the Federal Communications Commission (FCC) and the Department of Justice for the $30 billion merger, Comcast will officially take over operations of NBC Universal on Friday.

It is yet to be seen what will happen to the market when the biggest cable provider in the U.S. and one of the biggest television and movie studios combine. The FCC approved the merger with a long list of complex conditions imposed on the deal in order to ensure competition and innovation in the new online video distribution market. As discussed briefly in the previous post, the approval of the merger is just the beginning of the government’s involvement in the merger.

An interesting recent piece published online by CNN Money contributor Dan Mitchell discusses the FCC’s involvement in the Comcast-NBCU merger in depth. Mitchell argues that the government will now be more involved in the deal than if the antitrust regulators had just said “no” to the companies’ plan.

Mitchell points out that the FCC’s long list of conditions contains ambiguous language that will likely have to be interpreted through arbitration. Mitchell argues that government antitrust regulators should stick to making sure that the playing field is level for all competitors. If they believe that a merger or acquisition will violate that, they should say “no” to a proposed deal. Mitchell argues that approving a deal with such a complex set of conditions makes the government, in fact, a player and micromanager in that business.  

The next post will take a closer look at some of the conditions imposed on the Comcast-NBCU merger by the FCC.

Source:

How NBC-Comcast leads to more government regulation (CNN Money)