One way to do that is to keep competition in check. Comcast would be in a unique position to do just that, especially because, by adding NBC Universal to its holdings, Comcast will become one of the nation’s largest television programmers, too—the only company to have such a large position in programming, cable, and Internet distribution. Because it will control not only what content gets produced but also how it is distributed, the powerhouse will be in an unrivaled position to resist competition from Internet TV wannabes. Merger opponents are concerned that the company could disrupt competitors’ content flowing over its broadband connections, meaning it could make Comcast-produced shows easier to watch over its online network than shows produced by others. It could also refuse to provide its content to online competitors—thus depriving them of any lifeblood—and it could extend its practice of requiring customers who want to watch popular shows online to prove they are subscribers to their local cable service.
Federal regulators will undoubtedly attach conditions aimed at preserving competition and protecting the public interest in return for approval of the deal. Meanwhile, Comcast is conspicuously vague about its plans for Internet TV.
“Because this a very new business and neither we nor anyone else has figured out how best to deliver video online to consumers, it would be premature to set in stone any plans with respect to putting content online in any particular fashion,” said Comcast spokeswoman Sena Fitzmaurice.
Translation: don’t hold your breath waiting for Comcast to welcome an Internet utopia of free-flowing, no-charge television content. “It’s not that Comcast thinks it can kill online video. They’re not stupid like the recording industry was,” said Harold Feld, legal director with the Washington, D. C., digital advocacy group Public Knowledge. “What they want to do is manage the terms under which we’re going to change so that they can continue to make the tons of money they’re making right now selling their cable service.”
The Wide World of Internet TV
Neither Comcast nor NBC is an Internet neophyte. They haven’t waited for the online barbarians to reach their gates; rather, each controls a user-friendly path for its content to migrate to the Web.
In addition to shows available on its own NBC.com, NBC partnered with News Corp. to create Hulu in March 2007, with Disney joining in April 2009. The ad-supported website opened to the public in March 2008 and now dominates the free Internet TV world, allowing anyone with a broadband connection to choose from among 2,600 current prime-time television shows for viewing. Hulu’s offerings are extensive, but not all shows are available on the site and, for many TV series, only a few recent episodes are available for free. Comcast will assume NBC Universal’s 27 percent ownership in Hulu if the deal goes through unscathed by regulators.
Comcast, for its part, joined with Time Warner in June 2009 to create a system called “TV Everywhere” that streams television shows to customers over the Internet—as long as they keep paying their monthly cable bill. It started when Time Warner agreed to allow Comcast cable customers online access to shows from Time Warner networks TBS and TNT. Today, a Comcast subscriber enters a code into a website to access cable shows that are not available for free online. The selection of shows available to stream over the Internet corresponds with the subscriber’s cable package, making sure one isn’t able to access a program online that hasn’t been paid for with cable subscription.
Although management has been guarded about what will happen with online video after the merger, “lots of broadcast content” would go to Hulu and “cable content” would go on TV Everywhere, said Steve Burke, a Comcast executive and the new chief of NBC Universal. Burke was addressing Wall Street analysts the day the deal was announced.
Critics say Comcast will make NBC content less accessible, not more available.