United States v. Comcast Corp.

Comcast Corporation and NBC Universal, Inc. (defendants) agreed to merge. The US Department of Justice (DOJ) (plaintiff) filed suit to block the merger but, at the same time, filed for the court’s approval of a consent decree, which was agreed to by Comcast and NBC Universal. The consent decree contained various commitments by the merged entity designed to protect competition in video-programming-distribution markets. The DOJ also filed this competitive-impact statement, which served as a proposed final judgment. Absent the commitments, the proposed merger had the potential to harm both the traditional video market as well as the emerging online video market. In the traditional video market, Comcast’s ownership of NBC Universal’s programming and other content could have permitted Comcast to deny its video-distributing competition access to the content or to raise license fees for such content. This conduct could have caused the subscribers of Comcast’s competitors to become Comcast subscribers. The proposed merger could have harmed the online video market in the same way. The proposed merger also could have harmed the online market due to Comcast’s control in its footprint over broadband facilities that online video distributors (OVDs) needed to get content to subscribers. Despite these potential harms, however, the conditions to which Comcast and NBC Universal agreed ensured that neither the traditional nor the online video market was harmed. The agreed-upon conditions included: (1) a commitment to offer content to OVDs on terms comparable to those offered by other content providers; (2) a commitment to offer linear video content to OVDs on terms economically equivalent to those offered to traditional multichannel video programming distributors (MVPDs); (3) a commitment to give up Comcast’s voting and any controlling rights in Hulu and to provide content to Hulu as the companies did before the transaction; (4) a commitment to refrain from engaging in unreasonable discrimination against OVDs related to their needed access to Comcast’s broadband facilities; and (5) in the traditional market, a commitment to continue offering content to MVPDs. These commitments ensured that the online and traditional video-distribution markets were not harmed, preserving competition.