Comcast Shakes Up Media Landscape With NBC Deal

The deal means Comcast, an Internet and cable provider, will gain control of profitable cable networks, including USA, SyFy, Spanish-language network Telemundo and the Weather Channel plus the Universal Pictures movie studio and NBC itself.

It also means that Web sites such as Hulu, where NBC distributes its content for free, could change due amid the ongoing debate over whether to provide free online content.

While the agreement between Comcast and GE has been set since early September, GE had to wait to buy a 20 percent stake in NBC Universal held by Vivendi, the largest French telecommunications conglomerate. The deal leaves GE with a 49 percent share in NBC.

Nothing is final until federal regulators approve it, a process that may take a year to 18 months. Regulators could halt the sale or impose conditions that would make it less attractive to Comcast, such as weakening Comcast's bargaining position when dealing with TV owners.

What will Comcast do?

	Comcast is the nation's largest cable TV operator.

Comcast, a family-owned business based in Philadelphia, already has 23.8 million cable customers, 15.7 million high-speed Internet customers, 7.4 million Comcast Digital Voice customers. With the new deal, the company would also own one out of every seven TV channels.

The news release claims the deal "creates a leading media and entertainment company with the proven capability to provide some of the world’s most popular entertainment, news and sports content, movies and film libraries to consumers anytime, anywhere."

But Roben Farzad of BusinessWeek recalled the failed merger between media giant Time Warner and internet provider AOL a decade ago, saying these mergers are often "much easier said than done, however."

Andrew Leckey, president of Reynolds National Center for Business Journalism, said the future is uncertain, but the combination of companies in intriguing. "Any time there's a change, everybody looks at what they own, where they're going, where they're headed. And it gives everybody a little nervousness about how things might turn out. But it's a deal that does make sense on many levels,” he said.

Cheaper content or no more free video?

	Hulu is a popular Web site that streams TV shows from ABC, NBC and Fox, among others.

Some consumers hope that the merger could result in lower cable bills, now that Comcast can negotiate lower rates for NBC content. But analysts say that's not likely to happen.

"This is not about getting cheaper content," said Craig Moffett, a media analyst at Bernstein Research. Instead, he said, this merger could help Comcast tap into new revenue streams while they control access and content.

"Comcast is hostile to the open, free models that NBC has been supporting for many years," said Colin Dixon, a media analyst at Diffusion Group. "That should be a serious cause for concern."

The deal comes at a time when cable companies are beginning to lose money and advertising dollars because more consumers are getting their content for free on the Internet on sites like YouTube and Hulu.

Free networks down, cable companies up

	During NBC's heyday, shows like 'Friends' consistently landed in the top 10 of television ratings.

NBC has been stranded in fourth place in the ratings behind other free networks such as ABC, FOX and CBS since its iconic shows "Friends" and "Seinfeld" ended in the late 1990s. Since then, the economics of the broadcast television business have deteriorated with overall ratings and viewership declining along with advertising money.

Cable channels, however, have continued to grow because they rely on a steady stream of subscriber fees from cable companies like Comcast.