WASHINGTON - Sports programing, a must-have for U.S. cable operators, could end up being the center of a battle between Comcast, NBC Universal and the companies' critics as regulators assess the joint venture's impact on consumers.
Smaller cable companies fear that the top U.S. cable operator will jack up the fees for its sports channels, said Matthew Polka, president of the American Cable Association.
Sports is certainly a major part of this merger, said Polka, whose group does not oppose the deal but is asking for hard and fast conditions to protect its members, which include small cable companies operating in small and rural markets.
In particular, Polka wants his members to be charged the same carriage fees for Comcast-owned channels as Comcast does.
With sports programing among the most expensive to produce, largely because of payments to the leagues, Polka worried aloud that costs could go up if professional and college sports sought to play Comcast's Versus off against ESPN in negotiations.
I can tell you that the leagues are going to charge even more, he said.
Comcast, which declined to comment, owns the sports channel Versus and the Golf Channel.
In testimony on Capitol Hill on Thursday, Comcast CEO Brian Roberts and Jeff Zucker, president of NBC Universal are expected to argue the joint venture's benefits for consumers.
The new venture will lead to increased investment in NBCU by putting these important content assets under the control of a company that is focused exclusively on the communication and entertainment industry, according to their joint testimony.
Investment and innovation will also preserve and create sustainable media and technology jobs.
Comcast is the No. 1 U.S. residential Internet service provider and NBC owns a third of Hulu.com, the most popular U.S. website for viewing TV shows.
The joint venture must be approved by the Federal Communications Commission and the Justice Department's antitrust division.
Under the terms of the deal, Comcast would get 51 percent of a new joint venture that includes NBC Universal, valued at $30 billion, and Comcast's own cable networks, valued at $7.25 billion. GE would own the remaining 49 percent. As payment for its stake, Comcast will contribute $6.5 billion in cash and its cable networks.
(Reporting by Diane Bartz; Editing by Derek Caney)