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Comcast Close to Buying NBC

November 3, 2009 | Author: Ibex Marketing

It seems a little like a gasoline company buying General Motors, but it looks like the rumors about Comcast wanting to buy NBC Universal have some fire behind the smoke. In an article published Sunday by the New York Times, General Electric may be on the verge of reaching a deal with Comcast. According to the article, Comcast would end up with 51% of the company while GE would retain 49%. This would require that Vivendi, a French corporation, would have to sell its existing 20% share. And even if all the details can be hammered out, the deal still would require government approval.

What’s interesting here is that a content delivery company wants to buy a content creation company. The move would create a vertically-integrated system from studio to living room HDTV screen. This would give Comcast much more control, as well as diversifying its holdings. My crystal ball is cloudy as to what the ramifications might be once this deal goes through, but one obvious topic is that of net neutrality. Comcast is a major provider of broadband Internet service in this country, and now it might have a special interest in making sure that some content is delivered at a higher standard for quality of service than competing content. It will also be interesting what effect this deal might have on NBC Universal’s licensing deals with Comcast and with competing cable and satellite services.

In any case, it will be important to watch closely as the consequences of this deal start to appear.