Declaring it a "marriage made in hell," on November 13, the Florence-based media reform advocacy organization Free Press launched a national campaign urging the federal government to block Comcast's possible purchase of a controlling interest in NBC-Universal.
In an article on HuffingtonPost.com, Free Press' Executive Director Josh Silver wrote, "This train wreck of a deal will hurt all over. It will mean increased costs for cable television service; currently free online NBC content locked behind a pay wall; less opportunity for the distribution of independent media; even fewer choices and less programming diversity. On average, nearly one quarter of all channels offered to cable subscribers will be owned by the bloated Comcast."
Being the nation's largest cable company and Internet provider, Comcast makes a lot of its money delivering video and digital entertainment to televisions and computers across the country.
Currently, Comcast owns a few of its own cable production companies, such as the Style Network and the Golf Channel, and they partially own two Hollywood studios, MGM and United Artists. For them to include other cable channels in their offerings, though, they need to negotiate terms with outside media production companies, which is one of their major expenses.
Because they control what's broadcast to their cable boxes, they're able to charge a premium for the most desirable shows, but since pay-to-view options are still in a fledgling state on the Internet and most content is still free, right now there aren't as many opportunities for Internet providers to charge people for what they watch. With the merger, Comcast hopes this will change.
NBC-Universal includes 27 broadcast stations (most NBC or Telemundo affiliates), a bunch of cable stations you might actually watch (MSNBC, NBC Sports, Bravo, USA Network, Weather Channel, for example), and controlling stakes in Universal Studios and Focus Features. They also own Hulu.com, an up-and-coming pay-per-view online video service.
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In a November 13 conference call set up by Free Press to launch its anti-merger initiative, Josh Silver was joined by George Kohl of Communications Workers of America, a union that represents roughly 700,000 industry workers, including 6,000 from Comcast and 2,500 from NBC. Kohl's experience with both companies has been that their behavior has been "undemocratic" and "anti-union," and he feared the merger would cost jobs for both companies.
Also on the call was Mark Cooper from the Consumer Federation of America, who pointed out that it wasn't just employees of the companies that would be hurt financially. Broadcast television, including NBC, has been working to squeeze independent producers out of their lineup for the last 20 years. In 1990, networks owned just under 13 percent of their new programs, but by 2002 they owned 77.5 percent (data from "My Beef with Big Media" by Ted Turner). The merger, Cooper said, would help to shrink this gap, leaving little or no room for small or start-up production companies.
Comcast has kept quiet about the alleged merger and its plans for what the new conglomeration might look like, but media analysts suspect the company is most interested in NBC-Universal's ability to create quality content. As was made evident by Oprah Winfrey's announcement last week that she is planning in 2011 to pull the plug on her massively popular self-named television show so she can focus on her new self-named cable network, OWN, the future of broadcast television is bleak. Comcast seems to be already preparing for the day when cable television follows broadcast television to the grave, and it's looking for ways to continue to control and charge for content on the Internet.
"As broadband goes everywhere, more and more you can download shows directly from a production company over the Internet, so they don't need the distribution capabilities of an NBC," said Matthew Crocker, President of Crocker Communications, based in Greenfield and Springfield. "I remember last year, my wife and I kind of got into this little show on NBC. It probably had a million viewers, but that wasn't enough to keep it on the air, so they took it off and replaced it with some other junky show. But we could still watch the rest of the season online." Because the production company made its money by selling its work to broadcast companies, though, the show was discontinued.
In an ideal world, Crocker said, "If the bandwidth was big enough everywhere, small production companies who would love a million viewers could sell their work directly to the consumer." Such independent companies could write, shoot and produce a show without having to pay or please a distributor.
In many cases, this brave new world of independent media is already upon us, with original video and audio producers sharing their work online and others pirating and sharing mainstream content. This is why Comcast isn't resting on its cable box. By controlling both the distribution channels and the content production, it appears to be tired of just its slice of the market, and it's going after the whole pie.
If the merger were to happen, Comcast would be able to promote its own content over its competitors on cable television, limiting the freedom of that marketplace. But the real danger comes from what could happen to the Internet should Comcast become both a giant media distributor and producer.
Last year, Free Press and other Internet advocacy groups were able to show that Comcast was cutting off services to customers using peer-to-peer file-sharing technologies. Initially, Comcast denied the selective targeting of software or individuals, saying the outages were random and happened as its automatic Web traffic management system tried to balance usage and give all customers equal service. The Internet watchdog groups were able to show that the outages were, in fact, targeted to the particular users of specific file-sharing software, which resulted in the FCC's rebuking the cable giant.
At issue was not only whether Comcast had the right to decide how its customers used their bandwidth connection, but also whether as a company that sells programming through its cable boxes, it should be able to deny functionality to technologies, like peer-to-peer, that compete by making programming available via downloads. Since the FCC is an oversight committee and not a legislative body, though, its rebuke was not law, and questions like these continue to leave the public vulnerable to corporate decision makers.
Organizations like Free Press are continuously fighting against Internet provider attempts to offer tiered services, where only those willing to pay enough would have access to the highest speeds. AT&T, which has exclusive rights to the network that serves Apple's iPhone, has sued companies that were offering their own streaming video technologies to the device, but through a special agreement with the Major League Baseball iPhone users can stream their games for an additional fee.
"Whoever owns the bandwidth coming into your house can control over what you have access to," Crocker said.
