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After Cablevision Blackout, FCC May Take A Closer Look At Comcast Merger

Jack Donaghy: It's all about the vertical integration. Hey, anything that actually gets regulators to go through the motions of doing their jobs is fine with me, because I think this Kabletown -- excuse me, Comcast merger with NBC is a bad one.

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Jack Donaghy: It's all about the vertical integration.

Hey, anything that actually gets regulators to go through the motions of doing their jobs is fine with me, because I think this Kabletown -- excuse me, Comcast merger with NBC is a bad one. But I don't think it's realistic to expect anything more than that in this political environment. The politicians work for the corporations, not us:

The spat between News Corp. and Cablevision System Corp. that blacked out Fox programming for more than 3 million subscribers may raise hurdles for Comcast Corp.’s $28 billion deal to take control of NBC Universal.

Comcast, which is buying a majority stake in the media company from General Electric Co., may receive heightened regulatory scrutiny as a result of the dispute, said James Ratcliffe, an analyst at Barclays Capital in New York. The Federal Communications Commission is reviewing the acquisition.

“In light of the Cablevision-Fox dispute, there is clearly more attention being paid to program access, making restrictions more likely,” Ratcliffe said in an Oct. 25 note to investors.

News Corp.’s Fox blocked its programming, including two World Series games, from Cablevision for two weeks, until Cablevision agreed Oct. 30 to pay what it called an “unfair price.” U.S. regulators will want to prevent Comcast from using the threat of cutting off NBC programming to gain higher fees, Ratcliffe said. Comcast, unlike News Corp., may have the added incentive of blocking channels from rivals such as Dish Network Corp. to help lure customers to its cable service.

U.S. Representative Maxine Waters, a California Democrat, said the Fox-Cablevision spat made her “increasingly concerned with the potential harm” if a dispute arose between an enlarged Comcast and competing video provider. In a letter to FCC Chairman Julius Genachowski last week, she called for “substantive and enforceable conditions” to preserve competition.

Sena Fitzmaurice, a spokeswoman for Comcast, said in an e- mail that the Fox-Cablevision dispute shouldn’t affect its deal for NBC Universal. Jen Howard, a spokeswoman for the FCC, declined to comment on the commission’s review.

The deal would give Philadelphia-based Comcast, the largest U.S. cable provider, control over the NBC network and cable channels such as USA Network, as well as a share of the video website Hulu LLC, the Telemundo Spanish-language network and the Universal Studios film studio and theme parks. The FCC and Justice Dept. are reviewing whether Comcast would have too much power over access and pricing for TV and online programming.

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