American Cable Assoc.: Comcast-NBCU Deal to Cost Consumers $2.4 Billion Over Next Nine Years

Nov 8, 2010  •  Post A Comment

The Comcast-NBC Universal deal will cost consumers $2.4 billiion over the next nine years, TVNewsCheck.com reports.

According to the article, "In a new economic study released today {Nov. 8, 2010), the American Cable Association found that consumers over the next nine years will pay at least $2.4 billion more for pay television service as a result of unrestrained pricing power that will flow from the combination of Comcast Corp. and NBC Universal…"

Says the article: "’It is clear that the Comcast-NBCU deal will send monthly cable bills higher by billions of dollars over the next decade,’ ACA President-CEO Matthew M. Polka said, ‘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.’ "

The study found that "consumer harm" will happen in two ways.

In the first, according to the article, vertical harm will occur "from the combination of NBCU national cable programming networks and NBC owned-and-operated broadcast television stations with Comcast’s cable distribution assets. This alignment will permit Comcast-NBCU to raise the fees it charges for NBCU programming to Comcast’s cable and satellite rivals, including nearly 40 ACA member companies…"

The second harm "is horizontal, or control over key programming assets, which will permit Comcast-NBCU to raise prices from the market power derived by jointly negotiating NBCU’s suite of highly rated NBCU national cable programming networks and/or NBC O&O TV stations with Comcast’s key programming asset: regional sports networks (RSNs). This combination would allow Comcast-NBCU to demand higher fees from all pay-TV providers operating in markets served by a Comcast RSN."

2 Comments

  1. And yet another reason to see this deal to not happen. But, since it’s corporations that own our legislators and not the voters, this should sail right on through.

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