• by David Goetzl  @dgoetzl, August 18, 2010

NBC Universal's plans to launch a 24/7 local information channel in Washington could fuel Allbritton Communications' ongoing opposition to the proposed Comcast-NBCU merger. Already, Allbritton suggests a new Comcast would intentionally weaken its NewsChannel 8, so its potential control of a direct competitor is likely to heighten the acrimony.  

In an FCC filing, Allbritton charges that Comcast -- which controls 60% of NewsChannel 8's distribution -- insists on negotiating carriage fees that would force the 18-year-old channel off the air. Allbritton then reasons Comcast-NBCU would benefit as viewers migrate to its local NBC station (WRC-TV) and other outlets.

Included in the objections is the local news and lifestyle network NBCU plans for this fall, which would be a digital subchannel linked with WRC-TV. That is expected to carry the "Nonstop" brand, the same as NBCU's "New York Nonstop."

Also, NBCU "Nonstop" channels are scheduled to launch in Chicago and Philadelphia around the end of September, in line with the Washington version. But the incarnation in Washington may be the most successful, since that market is particularly infatuated with news.

Besides NewsChannel 8 (now known as TBD), Allbritton competes with NBCU in Washington as the owner of the local ABC station, WJLA-TV.

The FCC and Justice Department are reviewing the proposed Comcast and NBCU combination. Allbritton would like the deal scuttled. At the very least, it wants conditions placed to ensure NewsChannel 8 receives "marketplace" carriage fees. Cox and Verizon FiOS also offer NewsChannel 8.

In its own FCC filing on Wednesday, Comcast says it has no intention of snuffing out NewsChannel 8. The cable operator says there is no "incentive" to drop desirable programming, which could send its cable customers to other distributors.

In an interview, Allbritton senior vice president Jerald Fritz said his company has no "qualms" about competing with any NBCU property, so long as Comcast allows it to on equal footing.

NewsChannel 8 is in a precarious position because of the 1.4 million homes it reache; 853,000 are served by Comcast. It likely could not survive without affiliate fees paid by the dominant distributor in the Washington region.

Comcast and Allbritton have a deal running through the end of 2011. But Allbritton says Comcast is insisting on package deals that would cover NewsChannel 8 and retrans consent payments for six local ABC stations it owns, including WJLA.

Allbritton believes NewsChannel 8 carries more value on its own. So might the stations -- in markets such as Harrisburg, Pa. and Little Rock -- with the advent of lucrative retrans dollars.

Comcast says it will negotiate for carriage of NewsChannel 8 separately. But it does not want to "pay a premium price" that would leave it and its customers "vulnerable." The cabler further suggests Allbritton is using the FCC review "solely to obtain additional leverage in a business negotiation."

Beyond carriage fees, Allbritton raised the issue of advertising in the Washington DMA in its filing this week. The company says that Comcast-NBCU would control some 40% of the local TV sales market, which would "make it nearly impossible" for other sales organizations to compete.

The 40% figure comes from a would-be amalgamation of WRC, the local NBC station, and inventory Comcast sells for itself and on behalf of Verizon's FiOS in the region.

"This horizontal behemoth would dwarf all competitors -- and almost equal their share, combined!" Allbritton says in its FCC filing.

Allbritton suggests the new Comcast would merge the sales force for WRC with Comcast's local operations. That "colossal advertising force" would leverage its slew of channels to "drive non-NBC stations out of the market," Allbritton charges.

For its sake, Comcast says economic analysis show no evidence the merger would reduce competition in the ad market. And "notably, no advertiser has filed in opposition to the transaction," though several have supported it.

Comcast also suggests to the FCC that while the merger will create a larger market force, Allbritton has plenty of scale in Washington via the ABC station, NewsChannel 8 and the growing influence of inside-the-Beltway trade publisher Politico.