Comcast Corp. has agreed to buy a majority stake in NBC Universal, virtually changing the television industry for both cable and satellite providers. Major companies that rely on NBC programming such as Verizon and DirecTV might be in for a rude awakening in regards to higher programming fees. General Electric, which is the parent company of NBC Universal, will receive a $6.5 billion payment from Comcast.
While Comcast has recently been battle for better programming fees, the shoe is now on the other foot. The buck stops with them now when it comes to determining how much cable and satellite providers are charged for NBC content. With even more channels falling under Comcast’s power, it is surprising to see that there was no real regulatory scrutiny. Comcast controls channels like E! and the Golf Channel and even those programming fees might go up. DISH Network’s chief executive is on record by saying that he is concerned about the deal and the potentially rising programming costs.
With Comcast buying up regional sports networks, they seem to be gearing up to corner the sports programming market. While they don’t wield power like the NFL, satellite providers are concerned that the fees will be hiked up so much that they could potentially carry channels at an operational loss.
Speculators are split on their opinions on whether this is a good or bad idea. Personally, I am a bit weary of this deal. Since I get my entertainment from Comcast, them controlling more channels means higher subscription prices. Comcast is slowly gathering power in the television industry. While the FCC will probably monitor their every move, even if they do something wrong, they can slow disputes down by dragging them through red-tape and court sessions.
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