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Dunn Lambert, LLC
comprehensive legal services for businesses call 201-957-0874

Comcast, NBCU Merger Deal: High Costs, High Stakes

Comcast's challenge was not over after it crafted and proposed a $30 billion deal to merge with NBCU; it now faces intense political scrutiny. The potential deal is now six months into an anti-trust review by government regulators. The company has been working hard to appease its critics in Congress and the American public, but each week it seems a new criticism or group speaks out against the deal. 

The Philadelphia Inquirer, in a recent article, brings the audience up to speed with what has been involved and can still be expected in this complex approval process. The article states that Comcast has produced millions of pages of documents for government regulators and will spend over $100 million for the merger.

The merger has high costs, and the drawn-out regulation process has possibly taken a toll on profits and stock prices. The Inquirer reports that Comcast returned more modest gains to shareholders over the last year than its peer cable companies.

Comcast has made concessions in some areas, while sticking to its guns in others. According to The Inquirer, Comcast said it would voluntarily agree to certain government conditions, but would not allow "abusive" conditions to be imposed on them. Comcast has been trying to speed along the regulation process by actively working with regulators and members of Congress on the proposed deal.

A group of opponents vocally opposing the deal formed the Coalition for Competition in Media. The group includes Bloomberg, the National Organization for Women, the Sports Fans Coalition, and the Parents Television Council. The group last week sent letters to the National Association of Attorneys General and to five individual state attorneys general asking them not to support the deal, asserting that a merger of Comcast and NBCU would stifle innovation and be bad for consumers and competition.

Comcast successfully appeased some of its critics by saying it will spend $6 million to finance independent films or television programs. It also committed to spending $20 million to fund African-American businesses. Comcast also added to its corporate board of directors an Hispanic member. The company's spokesperson said that it considered the costs to be investments and not costs of the merger.


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