Heartland Institute Analyst Weighs In on Comcast-NBC/Universal Deal

Published December 3, 2009

James G. Lakely, co-director of the Chicago-based Heartland Institute’s Center on the Digital Economy and managing editor of InfoTech & Telecom News, offered the following comments on the Comcast-NBC/Universal deal announced on Thursday, December 3, 2009.

You may quote from his statement below or contact him directly at [email protected], 626-421-9414.

“The usual suspects are saying this merger will harm consumers and put too much power in the hands of large corporate forces–and they’re just as wrong as they’ve been every other time they sounded the trumpet of panic.

“Many alarmists said the deal that combined forces between AOL and Time Warner in 2000 would create a media colossus that would crush competition and rub out the vital line between content provider and distributor. A few years later, after bleeding tens of billions of dollars, the companies split apart when the combined operation couldn’t compete.

“The deal that merged Sirius and XM was characterized as dangerous because it would create a monopoly in satellite radio. Instead, it staved off bankruptcy and the complete collapse of that technology as a viable commercial enterprise–at least for now.

“Comcast may indeed establish a business plan in which NBC/Universal content gets priority on its network from consumers who prefer to watch TV on their computers. The proper response should be: So what? Such an arrangement is more likely to hurt Comcast’s bottom line than help it, because consumers quickly punish those who establish ‘walled gardens’ on the Web.

“History proves consumers are the most accurate and powerful regulators of the new media landscape. Government should get out of the way of this merger and revisit the new company on a case-by-case basis in the future to address actual, not theoretical, harms.”