FCC Head Stands Behind NBCU-Comcast Merger

The approval order requires Comcast to ensure competitors fair online and programming access.

Federal Communications Commission Chairman Julius Genachowski on Thursday submitted a proposal to committee members to approve the Comcast-NBC Universal merger. In doing so, Genachowski determined that the joint venture meets the FCC-mandated "public interest."

The public interest standard is broad, taking into account competition, localism and diversity issues. The joint venture is also subject to review by the Department of Justice, but the FCC and DOJ have worked closely on the review.

The proposal still needs to be approved by at least three of the five members of the FCC, and committee members will now have the opportunity to make changes to the proposal. The Republican members of the committee, Michael J. Copps and Robert M. McDowell, are not expected to offer substantial revisions. But Democrats Mignon Clyburn and Meredith Attwell Baker may not offer as swift an approval.

Although it's possible that the members could vote on the order immediately, that is unlikely. So the approval process could stretch well into January. The next agenda meeting is not until Jan. 25 at which time the commission has the option to bring the order for a vote if it still has not received approval.

The sticking points to approving the deal are program and online access.

Genachowski's proposal is said to require that Comcast not discriminate when it comes to making video content from NBC as well as Comcast networks like E! and Versus available to pay-TV competitors, according to the Wall Street Journal, and also allow third party providers to get their content on Comcast systems under reasonable terms. Additionally, Comcast must to adhere to so-called "net neutrality" protocols which bar companies from advantaging their own online video offerings over rivals such as Netflix. To that end, Genachowski proposed conditions that require Comcast to offer NBC programming to competing online video providers. There are also conditions requiring Comcast to keep genre channels like sports and news close together on the so-called television dial. That provision seems to address a request from Bloomberg LLC that its cable news network not be relegated to channel Siberia on Comcast cable systems but rather be clustered close to rival financial news network CNBC. (Bloomberg hired former FCC chairman Kevin Martin to lobby the FCC on their behalf.)

The FCC review process has been going on for the past nine months: Comcast submitted the joint venture for approval in January 2010; the FCC put out a public notice on March 18, 2010; throughout last summer and early fall there were three major rounds of pleadings which included comments, petitions to deny and oppositions and replies; the FCC requested numerous studies and held multiple public forums and workshops. All in all the FCC has received more than 30,000 written comments from the docket.

David L. Cohen, executive vp, Comcast, thanked the FCC for submitting the order and added that the company was "gratified" that the FCC and DOJ have made "substantial progress toward approval."

"After nearly a year, with one of the longest public comment periods in transaction review history, the filing of thousands of substantive comments, and the production of over 500,000 pages of documents by Comcast, we look forward to an expeditious vote in January by the full Commission approving the transaction," said Cohen.