Sen. Al Franken isn't joking around when it comes to Comcast buying a controlling interest in NBCU to form one of the world's most powerful media conglomerates. The former star of NBC's "Saturday Night Live" is leveraging his opposition of the deal into a larger campaign "to the lopsided influence of special interests on behalf of middle-class Minnesota families," according to the Minnesota senator's Web site.
Franken is taking donations to "support the vocal opposition (me!)," although he doesn't explain how the money collected will be used. "I don't trust Comcast and NBC to be honest brokers on this deal," he says on his website, sporting an oversized Comcast-NBCU logo in a slashed oval.
Those are fighting words that Franken and Senator Russ Feingold (D-Wis.) have already put in writing to Comcast and NBCU executives, requesting answers to their tough questions about the proposed deal.
Despite the need for rigorous scrutiny of such media consolidation, the Comcast-NBCU review is beginning to look like a three-ring circus. Franken wants NBCU and Comcast to agree to universally make all of their programming available online, not just for Comcast cable subscribers.
Franken doesn't specify whether it should be free or paid access, although he acknowledges that "the Internet is the future of the media business," which means Comcast-NBCU are going to have to make money somehow. Maverick media entrepreneur Mark Cuban has accused Franken of failing to realize that the gobs of additional bandwidth needed to service all of that online content will translate into higher Internet costs for consumers.
Feingold has joined the chorus with an acerbic letter to Comcast and NBCU executives, asking if they would stop bundling channels, divest all their Internet TV interests, and tie cable rate increases to the rate of inflation. "Will you also lock in the rates you charge for content either for cable network carriage or through retransmission consent?" Feingold was quoted as saying.
Whether or not intended, a confidential report to Congress released this week took the edge off the private and public grilling.
From all accounts, this confidential report appears to bet against this mega-merger turning out to be much different than others that have failed in the past. Vertically integrated post-merger entities "have so many pieces with conflicting market incentives that it proves impossible for executives to craft an internally consistent profit-maximizing business strategy, much less exploit market power to undermine competition," the report advises Congress.
The report prepared by the Congressional Research Service assumes the merger will be conditionally approved by the Department of Justice (DOJ) and the Federal Communications Commission (FCC), according to accounts. The report also appears to bet against significant changes in the marketplace that would prompt the merged company to take drastic action, such as weaning NBC from a broadcast network into a full-blown cable net that consumers would pay for.
If true, that's pretty amazing.
These times in media are all about significant marketplace changes. It is difficult to imagine the status quo surviving as digital interactivity is layered into everything about media, entertainment, communications and commerce.
That future, peppered with uncertainty, should be at the heart of the Comcast-NBCU review, which should not be conducted on the premise that the status quo will be in place a year or even five years from now.
Where are the companies' combined five-year plans and projections for where precisely revenues will come from and the costs that will be supported? Where are the new business models? Where is the honest talk about what has to change?
To say we're not there yet is to admit we don't really know what pragmatically will happen to advertising and subscription rates and opportunities, the access and variety of content and the integration and monetization of interactivity with consumers.
At the very least, the Comcast-NBCU merger review should be about what we don't know -- and that's a lot.