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Comcast/NBCU Dispute Need For Online Conditions

Amid growing attention on the issue of access to
online content, Comcast and NBCU execs met this week with FCC Chief of Staff
Edward Lazarus, Media Bureau Chief Bill Lake and other top officials to argue
against applying any online distribution conditions to their proposed joint

The FCC has been collecting string on the issue
throughout its vetting of the deal, including following up with Hulu execs onseveral occasions,
but the issue has heated up in recent weeks, propelled in part by the
Fox/Cablevision retrans ruckus.

According to an ex parte filing with the FCC,
Kathy Zachem, VP of regulatory and state legislative affairs at Comcast and
NBCU EVP and General Counsel Rick Cotton were in the meeting to "dispute
the need for any conditions in [the] proceeding related to the online
distribution of video programming."

Comcast argued, as it has before, that online and
traditional video delivery are complementary, saying "there is no reason
to expect this to change in the foreseeable future." Comcast pegs NBCU's
post-transaction share of online content at 15%, which it calls a "very
modest" amount.

"[T]here is no economic evidence or analysis
in the record supporting a theory of anticompetitive effects in the online
video marketplace or the need for any online video remedies," the execs

They also argued that there were "substantial
risks" to trying to apply program access or arbitration procedures to
online video.

Deal critics have used the Fox/Cablevision retrans
impasse to draw more attention to the online side of the deal. That came after
Fox briefly blocked Cablevison sub access to its content on and Hulu,
though not brief enough to escape the notice of public interest groups, who
hammered Fox over the move.

"Fox's decision to cut off access to its
online programming to Cablevision subscribers shows that "the current
generation of dominant content and content delivery networks are trying to
control the next," Public Knowledge told the FCC.