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Bloomberg files complaint against Comcast at FCC

June 13, 2011 |  8:03 am

Business media conglomerate Bloomberg LP accused Comcast of violating the conditions the federal government put on the cable giant in return for approving its merger with NBCUniversal.

In a complaint filed at the Federal Communications Commission on Monday, Bloomberg said Comcast is required to position Bloomberg TV near other news channels on its cable systems reaching almost 23 million homes, including CNBC, the dominant financial news channel that Comcast now owns.

Not long after the Comcast-NBC deal was announced, Bloomberg started aggressively lobbying the FCC for conditions that would require the cable giant, which has over 20 million subscribers, to put Bloomberg TV near CNBC on channel lineups because it feared it would be at a competitive disadvantage. It even retained the services of former FCC Chairman Kevin Martin to argue on its behalf before the regulatory agency. It has since added legal eagle David Boies to its team attacking Comcast.

In its order approving the merger, the FCC did include a section on so-called neighborhooding of channels, which Bloomberg says requires Comcast to move its channel closer to CNBC and other channels. For example, on Comcast's Washington, D.C., cable system, Bloomberg TV is Channel 103, while CNBC (Channel 39) is packaged much lower in the lineup with news channels CNN and Fox News.

Bloomberg demanded that the FCC force Comcast to comply with the neighborhooding provision and start moving its channel closer to CNBC in the next two months.

"This has become a test of how serious Comcast is about abiding by and implementing the conditions set by the commission.... So far, Comcast is failing that test," said Greg Babyak, head of government Affairs for Bloomberg LP.

Comcast fired back that the FCC order does not require it to "neighborhood" Bloomberg TV with CNBC and that Bloomberg didn't read the fine print.

"The FCC clearly stated that ‘we decline to adopt a requirement that Comcast affirmatively undertake neighborhooding’ and that the neighborhood condition ‘would only take effect if Comcast-NBCU undertook to neighborhood its news or business news channels,'" a Comcast spokeswoman said.
 
Comcast further countered that if it did what Bloomberg wanted, "millions of customers will be subject to disruption and confusion required by massive channel realignments across the country, all to benefit an already-thriving, $30-billion media company."

"The FCC carefully crafted its moderate, forward-looking condition precisely to avoid this type of upheaval," the Comcast spokeswoman said.

In the order, issued in January, the FCC said: "Specifically, we require that if Comcast now or in the future carries news and/or business news channels in a neighborhood, defined as placing a significant number or percentage of news and/or business news channels substantially adjacent to one another in a system’s channel lineup, Comcast must carry all independent news and business news channels in that neighborhood."

But a footnote in the same order added: "Our condition, however, would only take effect if Comcast-NBCU undertook to neighborhood its news or business news channels, which therefore would indicate that there was some value to neighborhooding despite additional search capabilities."

-- Joe Flint

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