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Walt Disney Co. has concerns with proposed conditions on Comcast - NBC Universal deal

January 13, 2011 |  9:19 am

Walt Disney Co. has expressed some concerns about the conditions the Federal Communications Commission wants to put on Comcast Corp.'s proposed deal to take control of NBC Universal.

Susan Fox, a vice president of government relations for Disney, talked on Wednesday with two senior staff members of FCC Commissioner Meredith Attwell Baker, a Republican member of the regulatory agency. In a regulatory filing disclosing the conversation, Fox said the conversation was regarding the conditions that may be put in place seeking to police how Comcast operates with regards to the growing online video marketplace.

The combination of Comcast's cable and Internet distribution system with NBC Universal's TV shows and movies has prompted competitors, lawmakers and media watchdogs to worry that the merger would give Comcast an unfair advantage.

The FCC, along with the Justice Department, is racing to put the finishing touches on approval of the deal which will likely include several conditions that the two hope will protect consumers and rivals from any anti-competitive behavior by the two companies. A decision could come as early as this week, but people close to the agencies expect it to happen next week.

If the Comcast - NBC Universal deal is approved, Comcast would be a co-owner in Hulu, the popular online video site that Disney is also an owner in along with News Corp. Comcast also has its own online video service, Xfinity.

The proposed conditions on FCC approval of the marriage include requirements that would attempt to prevent Comcast from favoring its own content versus that of its rivals, both on its systems and in online operations, agency officials said. There will also likely be conditions that would make it difficult for Comcast to withhold its own content from rival distributors and platforms.

Fox's letter to Disney does not go into great detail of what the media giant -- whose holdings include ABC, cable networks ESPN, Disney Channel and ABC Family as well as Disney Studios -- is worried about, but its filing is sure to raise eyebrows. Up until now, Disney had kept very quiet about the Comcast - NBC Universal deal. Fox's letter said the company was concerned about conditions "that may be dependent on or that would affect the marketplace negotiations of independent third-parties." Fox could not immediately be reached for comment.

Also detailing recent meetings or talks with the FCC in which the merger came up are Time Warner Inc. and Viacom Co.

Time Warner Chief Executive Jeff Bewkes had a phone chat with Federal Communications Commission Chairman Julius Genachowski on Tuesday of this week to talk about online video models. The two also appeared on a panel at the Brookings Institute, a Washington, D.C. think-tank. In its letter, Time Warner said Bewkes reiterated the importance of the online video market "evolving in a way that supports the creation of high-quality programming."

MTV and Comedy Central parent Viacom, which has already griped to the FCC about its worries that Comcast will favor its own content on its distribution systems over that of independent programmers, again expressed those fears.

-- Joe Flint

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