Comcast is evidently so confident they will receive approval of their merger that they've named their new management staff publicly while government officials fume behind the scenes at their arrogance. And why not? I can't think of any recent megamergers that have been denied by our brave and fearless regulators, can you?
“For a deal this large, and one that hasn’t been approved, Comcast’s behavior is presumptuous and arrogant,” one of the officials said.
Those officials did not want to be identified commenting on the negotiations. But the episode encapsulates what seems to be the differing attitude of Comcast on one side, and the Federal Communications Commission and Justice Department on the other: Comcast believes the proposed merger is an all-but-foregone conclusion, while the government is saying “just hold on a minute.”
The 180-day merger clock runs out on Wednesday, although an extension can be made without consequence. Sticking points appear to be what bother all of us: When (or if) this deal closes, Comcast will control everything from creation to delivery to pipelines to ticket sales. It will be a complete silo, start to finish, with monopolies in local markets and burgeoning control of Internet content whether or not one is actually a Comcast customer.
One of the real sticking points is Hulu, a joint NBC/Universal and Rupert Murdoch project.
The government is expected to impose conditions to protect against anti-competitive behavior by the combined entity. Conditions are a common feature of mergers, but they are especially significant in this case because the Comcast-NBC merger comes at a time of intense focus on online video. Regulators have repeatedly asked the companies for additional information about online video, in part because NBC owns a stake in Hulu, the streaming TV and film Web site.
According to filings before the F.C.C., officials there are considering imposing conditions on the Internet distribution of video. One condition could be to apply to the Internet “program access” rules that prohibit distributors like Comcast from withholding programming they own from traditional competitors. Such a condition could make it easier for entrepreneurs to distribute channels on the Internet, bypassing cable.
This merger is such a terrible idea. The only ones who benefit are Brian Roberts and Rupert Murdoch. The rest of us are stuck with little in the way of real options.
In the words of Al Franken,
"When the same company owns the programming and runs the pipes that bring us the programming, we have a problem."
Yep. It's a problem. A big one, and it isn't going away anytime soon.