Consumer groups and cable competitors Wednesday are offering a new reason for government regulators to eye skeptically Comcast’s and NBC Universal’s $30 billion deal.
They charge that it would give Comcast too much control over both the MGM and Universal movie libraries.
The studios’ libraries, it is claimed, could be used as a weapon to prevent rival internet-based video-download services from achieving significant share.
Comcast already owns a percentage of MGM.
The consumer groups made their comments at a press conference Wednesday and in a separate interview on the eve of two Congressional hearings into the deal — hearings in which Comcast CEO Brian L. Roberts and NBC Universal President-CEO Jeff Zucker as well as representatives of the consumer groups will testify.
Citing Comcast’s partial ownership of MGM and its ownership of NBCU, Andy Schwartzman, executive director of the Media Access Project, said the Comcast deal would "make it impossible for new providers to get off the ground,”
“The prospect of serious competition [to cable] coming from internet delivered television is already under attack from the TV Everywhere model [in which only viewers with subscriptions can access content, but they can access it from any platform]," he said at the press conference.
"The addition of the NBC content and the Universal film content gives substantive leverage [to Comcast.] It would make it impossible for new services like Hulu, iTunes. These would never get off the ground.”
A Comcast spokesperson declined comment.
Also at the press conference, Mark Cooper, research director of the Consumer Federation of America, said his group has found eight areas — from internet video to sports programming — where the Comcast deal would have major anti-competitive effects.
“When you look at this, the notion that this is good … is a perfect scam,” he said. “It will not fool the Justice Department.”
“It will diminish the marketplace for ideas and deny the public a choice,” he said.
Representatives of the American Cable Association, the Communications Workers of America and Free Press also questioned aspects of the deal.