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November 12, 2010 / Matt Gerardi

Comcast-NBC Universal Merger Could Cost Consumers Billions

According to a study commissioned by the American Cable Association,a coalition of of small and mid-sized independent cable companies, the merger between Comcast and NBC Universal could cost cable subscribers $2.4 billion in higher bills over the next nine years. (Reuters, ACA Masthead)

The report handled by former FCC economist William Rogerson concludes that unless the FCC and FTC impose some regulations on Comcast’s ability to withhold NBC Universal programming from other cable providers, consumers will end up footing the bill. Rogerson also claimed the $2.4 billion estimate is “a relatively conservative figure.”

The ACA’s prime concern are the costs associated with bargaining for access to NBCU’s programming if Comcast is allowed to do as it pleases with regard to pulling programming from other providers. These programming disputes end up being very costly for the smaller providers represented by the ACA and can take years to settle.

A Senate subcommittee on antitrust, competition policy and consumer rights has made it clear that one condition of approving the merger would be Comcast’s guarantee that it would not withhold access to NBCU’s content.

The subcommittee also voiced some concerns over the 32% stake in Hulu Comcast would inherit through the deal. Receiving some of the gobs of money Hulu is making would make up for some of the subscriptions lost to digital streaming services, a concern Comcast has no doubt considered. The subcommittee would require Comcast to relinquish that 32% stake.

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