Monster Media Merger
By Evan Mueller
After receiving government approval Jan. 18, Comcast, the largest provider of cable and internet in the U.S., will close a deal with General Electric to purchase a majority of the shares of National Broadcast Company-Universal (NBCU) for $6,500,000,000. Look at all those zeros.
With a 51% stake in NBCU, Comcast will be able to run the company as they wish, barring a few restrictions imposed by the Federal Communications Commission (FCC). Comcast cannot exclusively provide the media content they own, which now includes NBC, MSNBC, CNBC, Universal Studios and Pictures, Telemundo and much more.
This is supposed to ensure that competition between media providers remains fair. But Comcast has ensured that certain licensing methods remain intact, and will require internet video companies such as Netflix and Hulu to purchase rights to shows in bundles, like consumers do with channels when they sign up with the cable provider. The additional cost will be funneled to subscribers to make up for the extra cost.
Comcast is also restricted from prioritizing content they own over content they don’t, but I doubt anyone without a major legal budget would be able to challenge Comcast here.
I applaud FCC Commissioner Michael Copps for being the sole member of the commission to vote against this merger for being “too big, too powerful, too lacking in benefits for American consumers and citizens,” but his one vote was hardly enough to stop the deal. I fear, as does Senator Al Franken, that this merger will set a precedent for the future, leading more media providers to swallowing media producers.
“Make no mistake; if this merger is approved, it will only be a matter of time before we see AT&T trying to buy ABC-Disney or Verizon trying to buy CBS-Viacom,” said Franken. “And you know what these companies will say? They’ll say well, you let Comcast and NBC do it; now it’s our turn, and what will the FCC or DOJ have to say then?”
You might be wondering what benefits this merger has to the average consumer. Well, Comcast has agreed to add 1,500 shows for children and increase the diversity of its programming through new channels for Hispanic, Asian and black viewers. Also, Comcast proposes to add a combined total of 2,000 hours of news programming and build a video-on-demand service.
I can’t be the only one less than thrilled — I hardly watch television as it is and adding more “news” to the already noisy media atmosphere will only create more confusion. Maybe Comcast will use its huge coffers to produce some real investigative journalism, but I doubt it. The company is heavily invested in Washington, having paid 385 members of Congress and $12,600,000 for lobbyists last year.
With this purchase, Comcast becomes a more valuable company almost automatically, as stock market investors have already begun to throw more money at the company in order to get their share of the profiteering. Comcast is already an immensely wealthy company, which was able to pay its CEO Brian Roberts $40,800,000 last year.
This deal is adding to the problem of corporations controlling the media. Sure, I’m ticked I might have to pay a bit more for Netflix each month, but I’m really upset that we have let our news media fall deeper into corporate pockets. How can we expect a private business, which is constantly trying to increase its profits, to give us the unbiased, intelligent journalism we deserve? What about thoughtful, challenging films? I’ll be surprised to see a quality film produced by Universal in five years. There’s not much incentive for a massive company with so much to lose to take risks in its new media production.
This merger will be the first time in history that a cable company will control a major broadcast network. How will Comcast handle the power of controlling the media and its delivery? Will it be too much to handle? Or will the rich simply get richer? I’ll put my bet on the latter.