When Comcast Corp., the nation’s largest cable-TV provider, on Thursday took over NBC, a storied TV network, it was more than a big corporate deal, more than the biggest media merger of the decade. It signaled a shift in the way we consume news, entertainment and sports.
What does that mean for those of us on the couch?
Good things and bad, perhaps: a wider variety of TV choices; faster access to movies; and more programming on phones, laptops and elsewhere. And, just as likely, bigger monthly cable bills.
Viewers could quickly get favorite TV shows on mobile devices as part of Comcast’s push to provide programs whenever wherever. For movie fans, Universal Pictures films could get to cable almost immediately, meaning fewer trips to the theater.
The upshot is it’s a move away from over-the-air “free” TV to more paid content on various gadgets. The $13.75 billion deal supports the idea that the old model of advertising-supported TV is broken. The dual-revenue stream of cable, drawing from advertisers and subscribers, wins.
Pending regulatory hurdles, the move brings viewers closer to the long-promised goal of watching what they want when they want. But consumer advocates fear that the combined entity would control too much of the media world.
Comcast already serves a quarter of U.S. households that pay for TV. NBC brings with it the Spanish-language Telemundo; two dozen cable channels, including USA, Bravo and SyFy; regional sports networks; and Universal Studios and its theme parks. The goal for the combined company is to control both conduit and content, something the failed AOL-Time Warner merger hoped to achieve in 2000.
As in that merger, foes of the current one are outspoken.
“The combination of the country’s largest cable company, a TV network, a movie studio plus sports networks could present grave dangers to a free and open Internet,” warned Gigi Sohn, president of the advocacy group Public Knowledge. “A vertically integrated entity like that naturally wants to favor its own content.”
Comcast would have enormous power over who gets what programming and at what price, she said.
Price hikes may come
It’s possible the deal could force price increases for other subscription-TV consumers, too. Once Comcast controls NBC Universal, competitors such as DirecTV, Verizon and Time Warner Cable would have to negotiate with Comcast over how much they have to pay to carry popular and established NBC channels.
Comcast might play hardball where GE, NBC’s former longtime owner, had less stake in the outcome.
Comcast is Colorado’s largest cable-TV provider, with 840,000 subscribers, as well as the country’s largest, with 23.8 million customers.
NBC Universal is profitable ($1.7 billion earnings in the first three quarters of 2009), although the ratings-drenched NBC network is mired in fourth place and has suffered embarrassing programming setbacks, not the least of which is Jay Leno’s weak performance across five nights of prime time.
Comcast sought to reassure NBC affiliates Thursday that it is committed to providing free over-the-air TV and remains supportive of “localism.” It is unclear whether the cable giant will be sentimental about the value of NBC stations, born in the old media days, such as KUSA-TV in Denver.
Dave Lougee, president of the broadcast division of Gannett, which owns KUSA, said he was “cautiously optimistic.”
“I do think in general this is a good thing for NBC,” he said. “GE had an enormously successful run, but times have changed. Comcast is a smart and strategic company. They will be a good steward of NBC. They will focus a lot on improving the entertainment side of the network that is now challenged.”
The deal, he said, “will allow them strategically to stay strong in sports.”
By combining forces the way ABC has been with ESPN, Comcast and NBC “may create competition for ESPN which benefits the consumer.”
Move “pro consumer”?
Comcast calls its move “pro consumer” in that it will be able to offer a broad array of entertainment choices. What it doesn’t say is that you may pay more for all of that choice.
Consumer advocates believe that more media concentration means higher prices.
“The immediate effect is potentially higher rates and less choice of video programming,” said Andrew Jay Schwartzman, head of the Washington, D.C.-based Media Access Project. “Long term, it threatens the idea that the Internet could become a platform for access to video programming.”
For instance, he said, NBC is a partner in the video-streaming website Hulu, and Comcast may want to pull the plug on Hulu. “By insisting the only access is for Comcast customers, they may cripple online video before it gets off the ground.”
Across political lines, activists voiced objections to the deal Thursday. The left-leaning Center for Digital Democracy assailed Comcast for its “cable monopolist mentality.” The conservative Parents Television Council called the merger “anti-family and anti-consumer.”
To viewers who heard NBC’s three-note chime (the notes G, E and C for General Electric Co.) for more than a half century and who think of ABC, CBS and NBC as real TV, the news is unsettling. In fact, NBC is a minor piece of the deal.
Comcast sought the moneymaking cable properties, such as Bravo and USA, not the old home of Milton Berle, Johnny Carson, Bill Cosby, “Seinfeld,” and “Saturday Night Live.” In business terms, the old network is a footnote.
Comcast said it will honor the iconic NBC brand, leave NBC News alone, improve public-interest TV and make available for free the NBC Universal shows that currently cost money over its on-demand service.
For the immediate future, nothing will look different, but Tina Fey will have lots of new material for “30 Rock,” trading old bosses at GE for new bosses at Comcast as punchlines.
But soon, more NBC content may be considered “premium,” requiring a fee. Olympics on demand? It’s possible.
NBC got its start as a radio outfit in the 1920s, strutted as the Peacock network through the late 20th century and declined in recent seasons as it failed to replace long-running hits and ended up with duds such as “Knight Rider.” NBC now begins its next chapter as a little piece of the cable, online and on-demand puzzle. Goodbye, quaint old TV; hello, new media.
Joanne Ostrow: 303-954-1830 or jostrow@denverpost.com
