Thursday, December 3, 2009

Just Say No To Comcast/NBC Merger Campaign Launched


The media watchdog group FreePress.net is launching a campaign to stop the announced merger between Comcast and NBC Universal.

The organization says that many Washington and Wall Street analysts have presumed that the merger will likely be approved by the relevant regulatory authorities, thereby implying that the union is a done deal. But FreePress.net argues that antitrust laws should be used to stop it because - the group argues - a merger would stifle competition.

In a report released today, FreePress.net maintains that a vertically integrated Comcast/NBC would not only control marquee television and movie content, it would also control the primary avenues for distributing that content: a major television broadcastnetwork, a major cable system operator and a major broadband Internet access provider. Because the
merged entity would control both content and distribution, it would have both the incentive and the market power to limit the access of competing content to the distribution platforms it controls, the group warns.

A new Comast/NBC entity also, the report cautions, have the power to enforce anticompetitive bundling and pricing of its own programming, or in some
cases, to deny its competitors access to its programming altogether.

Comcast/NBC would own three distribution platforms — TV stations, cable systems and broadband Internet services — reaching all or part of the population in 11 TV markets, including New York, Chicago, Philadelphia, San Francisco, Boston, Washington, D.C., Houston, Miami, Denver, Hartford and
Fresno. This would lead, the FreePress.net report concludes, to an unacceptable level of concentration of video distribution and advertising
market power at the local level.

According to the report, an even great threat the proposed merger would have from competition stems from the fact that Comcast is not only the dominant multichannel video distributor in the nation, but also the number one broadband Internet service provider. Additionally, in acquiring NBC,
Comcast would obtain a substantial interest in Hulu, the number two online video provider.

All this, the organization argues, sets the stage for a company that could starve competition online video platforms by denying them access to valuable content the new mega-media company would control.

And if a new Comcast/NBC moved all that content behind a pay wall - available only to its customers - it would create an anticompetitive bundled product. The company could potentially, FreePress.net warns, force customers to purchase its cable and Internet services in order to get access to its online NBC programming.

Finally, FreePress.net fears that if government regulars give approval to the merger, its competitors - in order to remain profitable - will follow suit creating even more media consolidation in the United States.

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