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What Does the Comcast-NBCU Merger Mean for Business?: Part 2

The previous post began to discuss some of the implications of the Comcast-NBC Universal merger recently approved by antitrust regulators with the FCC and Department of Justice. Comcast officially takes over control from General Electric of NBC Universal on Friday.

An interesting recent piece published online in CNN Money by contributor Dan Mitchell questions whether it would have been better for the government regulators to have just said “no” to the deal, rather than open up years of government micromanagement of the merged companies. The deal will also likely lead to litigation as the FCC’s conditions are challenged and interpreted by Comcast.

Mitchell questions why the companies should merge if the FCC’s conditions seek to keep separate the ISP and cable business of Comcast from the content business of NBCU, since the point of the merger would seem to be to take advantage of such a combination. The FCC’s involvement is meant to ensure that continued “competition drives innovation in the emerging online video marketplace.” Mitchell questions in his piece whether the merger and its conditions will enhance or stifle competition.

The FCC’s conditions on Comcast are complicated and many. The conditions include how much money Comcast can charge customers for broadband service; the conditions also mandate that Comcast sell its film and television offerings to online distributors for the same prices as other cable and satellite companies.

Comcast is prohibited from denying Internet service to people who are not customers of its cable service. It must also offer Internet access at lower prices for low-income consumers. The FCC says that Comcast must also end its decision-making role at Hulu. Overall, it is hard to predict what the merged company and the field of competition will look like when the FCC’s conditions expire after seven years.


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

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