Senate Hearing Examines Comcast-NBC Deal

Comcast and NBC Universal didn't get a whole lot of love at Thursday's emotional Senate hearing on their proposed merger. But company representatives did get plenty of questions.

At the Senate Judiciary Committee hearing, Subcommittee Chairman Herb Kohl (D-WI) cracked no smiles as he ran through four "principal areas of concern" about the deal: potential programming price hikes, loss of free over-the-air TV content, hobbling independent programmers, and weakening Internet TV. "It is essential that you explain to us and the American public how the creation of this media conglomerate will serve the interests of the American people, not just the interests of your companies," Chairman Kohl grimly demanded of Comcast CEO Brian Roberts and NBCU President Jeff Zucker as they prepared to make their case.

Even Sen Orin Hatch (R-UT) confessed some concern about the marriage. He called worries about the union "justified" in light of rising cable rates that are "difficult to understand." But it was the faux pas in his opening statement that suggested how nervous everyone is about this deal. "Both of these countries, er, companies are iconic in their industries," Sen Hatch began. And later: "While horizontal murders, uh, mergers, tend to receive more criticism and scrutiny, vertical mergers" can also result in "a significant foreclosure of competition," he warned.

Sen Al Franken (D-MN) disclosed that Comcast's Roberts had met with him days earlier, claiming that the FCC's program carriage rules would protect consumers. "You said that those rules will make sure that you always have a wide variety of programs because they forbid you [NBC] from discriminating against other company's programs." With that, Franken pointed to a large sign board behind him with a quote from Comcast in its recent battle with the NFL Network over which tier on Comcast would carry the sports channel.

"The Commission is simply not equipped or constitutionally empowered to make an independent assessment of the myriad, complex, and dynamic considerations that affect carriage, tiering, and pricing decisions," said the quote from Comcast attorneys. "Thus the First Amendment requires that the Commission exercise extreme caution before interfering with any carriage decision."

"In other words," Franken continued irately, "looking to get approval for this merger, you sat there in my office and told me to my face that these rules would protect consumers but your lawyers had just finished arguing in front of the Commission that it would be unconstitutional to apply these rules."