FCC Chair Moves Comcast-NBCU Deal Ahead — With Conditions

Commissioners can now begin non-public process of negotiating on conditions for the cable giant’s $30B acquisition of NBCU

Comcast's proposed $30 billion deal for NBC Universal took a big step forward Thursday.

FCC Chairman Julius Genachowski endorsed an order that would allow the deal to go through — with a number of conditions — and sent it to the remaining four FCC commissioners for approval.

It needs approval from two more besides Genachowski to take effect.

The proposed order includes conditions designed to ensure that the new company doesn't prioritize its own content over that of its rivals, and that it makes its own content available to other cable providers, FCC officials said. They did not offer specifics.

The order is the first official step by the FCC toward giving Comcast the prize it has sought for more than a year. But it's only the start of what could be weeks of non-public negotiations by the Federal Communications Commission's five decision-makers.

Also read: New FCC Chief Julian Genachowski Grilled

The merger is widely expected to be approved; the question is how, and with what conditions.

The proposal already has the vote of Genachowski, who, as chair, can decline to float any proposals with which he disagrees.

The FCC is reviewing the public interest implications of the deal. The Justice Department is conducting a separate anti trust review of the deal

Genachowski and the two other Democrats on the board approved net neutrality guidelines along party lines earlier this week, but the three can't be guaranteed to vote together this time because Democratic Chairman Michael J. Copps has long expressed skepticism of major corporate mergers. He dissented two years ago on the Sirius-XM merger.

The two Republican commissioners, meanwhile, are unlikely to approve anything they see as hindering Comcast's ability to do business. Which could force Genachowski to scale back his conditions to get approval for the merger.

None of the negotiations between the commissioners need go down in public. They can make changes and alterations to any part of Genachowski's proposal by simple majority agreement — votes they can cast without meeting together or leaving their offices. It was unclear whether the final vote could also take place without a public meeting or whether the commissioners would vote at their monthly public meeting, as they did on net neutrality.

Comcast, which initially said it hoped for merger approval this year, said Wednesday it was now aiming for approval from the Federal Communications Commission in January.

The Department of Justice could then challenge the merger, but has expressed no interest in doing so. FCC staff consulted with the depatment before presenting Genachowski's proposal, which could smooth future potential roadblocks.

In a statement, Comcast executive vice president David Cohen said the FCC had made "substantial progress" toward approval.

"Starting on the day of the deal's announcement, we have emphasized that this transaction is pro-competitive, pro-consumer, and will deliver real public interest benefits," he said.

Critics of the merger have said much more study is needed and that the deal would limit choices and raise costs for consumers, a contention Comcast denies.

Sen. Bernie Sanders (I-Vt.) issued the following statement Thursday: “The FCC released some very bad news for the future of American media and, in my view, for the future of American democracy … At a time when a small number of giant media corporations already control what the American people see, hear, and read, we do not need another media conglomerate with control over the production
and distribution of media content. What we need is less concentration of ownership, more diversity, more local ownership — and more viewpoints.

"If this merger is approved, I have little doubt that Comcast-NBCU will retain hundreds of attorneys and lobbyists to exploit gaps and loopholes in any conditions and regulations.  Once we allow companies to become this powerful, the FCC does not regulate them. They regulate the FCC."

The media reform group Free Press also expressed disappointment in the FCC's action.

“We are deeply disappointed that the FCC is apparently moving to approve this merger. Comcast’s takeover of NBC would have a harmful impact on competition and consumers, particularly in the emerging online video market," Free Press policy counsel Corie Wright said in a statement. "The conditions reportedly proposed by the FCC chairman recognize this danger, but we have serious concerns that they will go far enough to protect the public from this unprecedented media behemoth."