Comcast-NBC Universal Deal Could Cost Consumers Billions
The reason for the additional costs is that the new combined firm would have tremendous pricing power as it marries its cable carrier operations with its content-producing business. The ACA opposes Federal Communications Commission and Justice Department approval of the transaction unless a number of restrictions are added.
"It is clear that the Comcast-NBCU deal will send monthly cable bills higher by billions of dollars over the next decade, underscoring ACA's view that regulators must protect consumers and competition from a transaction whose benefits are vastly outweighed by its harms. Without meaningful and cost effective conditions on the Comcast-NBCU transaction, regulators also run the risk of crippling effective competition in the pay-TV distribution market," ACA President and CEO Matthew M. Polka said.
The ACA goes on to suggest a series of restrictions on the Comcast-NBCU deal. These include a proposal that "All pay television providers, including bargaining agents, that cannot reach a mutual agreement with Comcast-NBCU for any of its programming may submit a dispute to binding baseball-style commercial arbitration."
While the study is not tainted, it may be biased by the fact that small cable networks acting in concert are attempting to block a deal that involves a much larger cable entity. It appears the NBCU deal will receive government approval, so their requests will likely go unheeded.