Comcast’s NBC Deal Reshapes TV Landscape With ‘Fat Pipes’
The country’s largest cable company announced today it plans to buy a controlling stake in one of the most venerable names in the nation’s entertainment industry. Comcast Corp. is offering $13.75 billion for 51 percent of NBC Universal from General Electric Co., and thereby giving it control of the broadcast network, a wide range of cable channels and a major movie studio. “This is the Holy grail of content and distribution,” Roben Farzad of BusinessWeek told The Rundown. “To own the fat pipes and everything that comes through, not just the channels that go through the fat pipes…It has always been coveted to combine those two, but it has never been executed.” Comcast was particularly interested in NBC’s cable channels, such as Bravo, USA Network and SyFy, as a means to generate future revenue and expand the types of video offerings it provides to its cable and Internet customers. Movies released by Universal could also potentially be offered via on-demand services at the same time as DVD or other releases. Consumer groups have voiced concerns that this deal will lead to further consolidation, as competitors like DirectTV or Dish Networks would seek similar marriages and unfairly raise prices for services. The deal has been under discussion for months between Comcast CEO Brian Roberts and GE CEO Jeff Immelt, but it is likely to face additional months of scrutiny from government regulators exploring potential antitrust implications. Tonight on the NewsHour: Tune in for more analysis of the deal from Farzad and other guests.