Comcast-NBCU Order Being Drafted at FCC, But Final Order May Take Longer
Career FCC staffers’ work on drafting an order on Comcast’s plan to buy control of NBC Universal may not result in the deal’s being approved as quickly as had been expected, because of the agency’s attention to net neutrality, said many agency and industry officials watching the review. They said staff work appears to be far along on the multibillion dollar deal, and ex parte filings indicate that the companies in the deal are discussing possible conditions on it. Conditions don’t seem to have been settled, agency and industry officials said. Chairman Julius Genachowski had at one point reportedly hoped to have an entire draft of the order available around Thanksgiving (CD Nov 5 p3).
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Key officials from the chairman’s office who will probably spend considerable time on the deal before and after a merger order is circulated, such as Chief of Staff Eddie Lazarus and Rick Kaplan, the chairman’s chief counsel, are devoting much of their attention to net neutrality, commission and industry officials said. That leaves them less time to focus on the drafting of the order and seems likely to put off the date for commission action, they said. Approval of the deal now seems more likely in early 2011 than this year, they said.
Some sections of the merger order appear to have been written, in a draft form suitable to be seen by officials such as Lazarus, but others may not have been finished, agency and industry officials said. Career commission staffers reviewing the deal have indicated to outsiders recently that they drafting an order, industry executives said. Genachowski said Tuesday that the commission has no timetable to approve or deny the deal (CD Dec 1 p7). His decision to seek a vote Dec. 21 on a net neutrality order hasn’t affected review of Comcast-NBC Universal, a senior commission official said Wednesday. A spokeswoman for the Media Bureau, which is said to be drafting the Comcast-NBCU order, declined to comment.
"The Comcast/NBCU deal is too important to play second fiddle to the open Internet proceeding and will, of course, be affected by what the commission does and does not do” on the order, said Senior Vice President Andrew Schwartzman of the Media Access Project. “There clearly isn’t enough oxygen in the room to give this transaction the attention it deserves until after Dec. 21. And assuming that even the FCC staff is entitled to celebrate the holidays, we're into January.” Schwartzman’s group is among those opposing the deal.
The deal won’t be acted on by the FCC until the first quarter, said cable lawyer and consultant Steve Effros. The exact timing depends on when the Justice Department, reviewing Comcast-NBC Universal for antitrust reasons, releases its decision, he said. “If Justice comes out early in December, [the] FCC might make it before the end of the year, but I doubt it.” The department has been farther along in its review than the commission in its own.
"Net neutrality will use up most of the commission’s oxygen over next few weeks, which will make it difficult to finish Comcast-NBCU at the same time,” said analyst Paul Gallant of MF Global. “If something has to give, it will probably be the deal.” Jeff Silva of Medley Global Advisors said he thinks that “the timeline for FCC action on Comcast-NBC Universal has more to do with all the policy and administrative peculiarities specifically associated with the transaction generally, as well as the likely fashioning of conditions,” than with the issue of net neutrality itself.