Acquisition of NBC Universal by Comcast
NBC Universal from GE | |
Type |
|
---|---|
Cost | US$13.75 billion[1] |
Initiated | December 3, 2009 |
Completed |
|
Resulting entity | NBCUniversal |
On December 3, 2009, telecommunications company
History
Background
Comcast was, at the time, the largest
2012 | Universal celebrates its 100th anniversary NBCUniversal divests its A&E Networks minority stake |
---|---|
2013 | Comcast buys GE's remaining 49% of NBCU Comcast/NBCU assumes full ownership of Sprout |
2014 | Comcast attempts to acquire Time Warner Cable for $45.2 billion NBCUniversal reaches a new long-term deal with WWE |
2016 | NBCU acquires DreamWorks Animation |
2017 | Sprout relaunches as Universal Kids |
2018 | Comcast acquires Sky after a heated bidding war with 21st Century Fox |
2019 | NBCU acquires Cineo Lighting |
2020 | NBCU launches Peacock |
2021 | Grand opening of Universal Beijing Resort |
2023 | The Super Mario Bros. Movie becomes Illumination's highest-grossing film |
and NBC ranked fourth at the time among the major US broadcast television networks. By contrast, some of its cable networks (such as
Proposal
Negotiations between Comcast and NBC Universal for a potential acquisition began as early as March 2009; News Corporation and Time Warner were also reportedly interested in purchasing the studio. By September 2009, Comcast had negotiated a purchase of a stake in the company from GE, but the overall deal was held up by negotiations with Vivendi for the sale of its 20% stake to GE.[4] On December 3, 2009, Comcast and NBC Universal confirmed a $6.5 billion deal to merge the two companies, pending approval from the United States Department of Justice Antitrust Division; the deal would be structured as sale of Vivendi's stake in the company to GE for $5.8 billion, followed by Comcast acquiring 51% controlling stake of NBC Universal, and contributing its existing media properties to the company, themselves valued at $7.25 billion. As a result, NBC Universal would become a joint venture between Comcast and GE, with Comcast holding a 51% majority stake. As a whole, the deal valued NBC Universal at $30 billion. The deal included an option for General Electric to sell further stakes in the company to Comcast over seven years, or for Comcast to buy stakes at "specified times". Jeff Zucker was to remain CEO of NBC Universal after the acquisition, and remain headquartered in New York, but would report to Comcast.[1]
Comcast CEO
The deal was subject to the approval of the
Opposition
The acquisition was opposed by several media activists, particularly those who were against
Approval and closure of acquisition
On January 18, 2011, the FCC and the
Comcast agreed to offer an internet service plan for qualifying low-income families for at least three years as part of the acquisition. The plan, "Internet Essentials", initially offered a 1.5-megabit connection for $9.95 per month (increased to 5 megabits in 2013)[12] with no activation or equipment fees, as well as an opportunity to purchase a discounted netbook and receive free "internet training".[13] Of an estimated 2.60 million households eligible for the program, about 0.22 million households participated in the program as of June 2013.[14][15][16] Comcast stated that the program would accept new customers for the duration of the mandate.[13] In March 2014, as he met with FCC concerning a proposal to acquire Time Warner Cable, Comcast vice president David Cohen told reporters that the Internet Essentials program would be extended indefinitely.[17]
Comcast intended to buy out the rest of GE's stake in NBCUniversal over the following seven years. Ownership remained split at 51%–49% for two years, and later, on February 12, 2013, Comcast announced its intention to complete the purchase all at once and assume 100% ownership of the company by the end of March.[18][19] The deal was officially completed on March 19.[20]
Scale of new company
The merger expanded Comcast's scale significantly; Comcast's position as a cable television provider produced
Influence
This section is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor's personal feelings or presents an original argument about a topic. (April 2014) |
The video marketplace has changed structurally with or without the Comcast-NBCUniversal acquisition. More and more videos, programs, and advertisements are displayed on the Internet, not the traditional media channel, television. As a result, the video business model has gradually changed as time goes by. Comcast has reached such a significant scale that it now owns many media and entertainment properties. However, facing the uncertainty of the video marketplace, many people proposed their concerns:
Impact on the video market
One of the claims is "Comcast would be able to use its vertically integrated position to deny rival distributors access to programming or to raise the cost of that programming". Comcast-NBC will face two rival distributors – the satellite and telephone company and the new entrant. Of course, both of them worry about the domination that Comcast-NBCUniversal may be capable of establishing and the entry barrier. The big challenge for the satellite and telephone company is to find a new business model to convince the programmers that their model will benefit them more than Comcast-NBCUniversal. However, Comcast-NBCUniversal also keeps improving its business model, which is unhappy to the new entrant.
The other claim is that "Comcast will use the merger to change NBC into a cable network, at the expense of local programming". Some observers predict that Comcast may convert NBC to a cable network. They think that Comcast must have to make some changes because NBC broadcast station traditionally has only one revenue path, the advertising;[22]
Impact on competition, diversity, and localism of media company
The three major topics are media ownership, competition, diversity, and localism. Once two or more media companies amalgamated, such as in the case of the merger of News Corp/DirecTV and
One of the claims is, "A combined Comcast-NBC Universal might have the unique ability to craft new business models that benefit consumers." With new digital technologies to distribute videos, advertising revenues have yet to be generated in the new market. Therefore, these enterprise operators must find a new business model to make the revenues financially available. Facing the uncertain environment, Comcast Senior Vice President for Corporate Development, Robert Pick, still shows his determination. He says, "the combination would ameliorate the negotiations friction that had made it difficult for Comcast, primarily a distribution and communications company, to convince content owners and programmers to work with us to create and deliver more content to consumers in a greater variety of ways."[24]
Impact on price of video markets
Many observers, such as journalist Adam Thierer, predict that the price of distributing videos were going to fall dramatically in the near future because three distribution products of Comcast (broadcasting, television, and internet) are all merging into the network.
On-air effects
The first major on-air effects of the deal occurred in February 2011, when Comcast began to align its sports properties with the
The acquisition was announced during the
See also
- Acquisition of 21st Century Fox by Disney, a corporate act of The Walt Disney Company which acquired the majority of 21st Century Fox assets, mostly film, television studios and entertainment pay TV channels.
- 2019 merger of CBS and Viacom, a media merger deal that combined the operations of CBS Corporation and Viacom, which had previously split in 2005, into a new company called ViacomCBS (now Paramount Global).
- Merger of Sprint Corporation and T-Mobile US
- Concentration of media ownership
Further reading
References
- ^ a b c d Tim, Arango (December 3, 2009). "G.E. Makes It Official: NBC Will Go to Comcast". The New York Times. Retrieved April 7, 2011.
- ^ Tim Barwell (October 3, 2009). "Comcast, NBC Deal Faces Financial, Legal Obstacles, WSJ Reports". Bloomberg. Retrieved April 6, 2011.
- ^ a b Stelter, Brian (January 27, 2011). "Lost in the Comcast Takeover? A Logo's Peacock". Media Decoder Blog. The New York Times. Retrieved February 25, 2019.
- ^ a b David Goldman and Julianne Pepitone (December 3, 2009). "GE, Comcast announce NBC Universal joint venture deal". CNN Money. Retrieved March 4, 2013.
- ^ Larry Eichel (February 22, 2004). "ESPN is a big factor in bid for Disney Comcast..." The Philadelphia Inquirer. Retrieved February 27, 2014.
- ^ a b Newman, Jared (January 28, 2010). "Comcast, NBC Acquisition: Pros and Cons for You". PC World. Retrieved April 19, 2011.
- ^ "Opponents Line Up Against Proposed Comcast/NBC Merger". DailyFinance. AOL. Retrieved April 2, 2014.
- ^ "Comcast Rivals, Partners Seek Conditions on NBC Deal". The Wall Street Journal. Retrieved April 24, 2014.
- ^ Anderson, Nate (May 11, 2011). "After approving NBC buyout, FCC Commish becomes Comcast lobbyist". Ars Technica. Retrieved February 13, 2012.
- ISSN 0099-9660. Retrieved February 25, 2019.
- ^ "Summary of GENERAL ELECTRIC CO - Yahoo! Finance". Yahoo! Finance. May 19, 2011. Archived from the original on May 19, 2011. Retrieved December 17, 2023.
- ^ Mike Rogoway (September 12, 2013). "Comcast boosts speeds for low-cost Internet service for low-income families". The Oregonian. Retrieved March 5, 2014.
- ^ a b David Murphy (August 7, 2011). "Comcast Launches Low-Cost Internet for Low-Income Families". PC Magazine. Retrieved February 14, 2014.
- ^ "SECOND ANNUAL COMPLIANCE REPORT ON INTERNET ESSENTIALS(pp 10)" (PDF). Comcast. July 31, 2013. Archived from the original (PDF) on June 30, 2014. Retrieved March 19, 2014.
- ^ Brad Tuttle (September 20, 2012). "Why Aren't More Families Signing Up for Cheap Internet Service?". Time. Retrieved March 5, 2014.
- ^ Chozick, Amy (January 20, 2013). "Mixed Response to Comcast in Expanding Net Access". The New York Times. Retrieved January 21, 2013.
- ^ Todd Shields (March 4, 2014). "Comcast Pledges Low-Cost Web as It Meets on Time Warner". Bloomberg. Retrieved March 5, 2014.
- ^ Nakashima, Ryan (February 12, 2013). "Comcast to buy GE's 49 pct stake in NBCUniversal". MSN. Associated Press. Archived from the original on February 16, 2013. Retrieved February 12, 2013.
- ^ Chozick, Amy; Stelter, Brian (February 12, 2013). "Comcast Buys Rest of NBC in Early Sale". The New York Times. Retrieved February 24, 2013.
- ^ Lieberman, David (March 19, 2013). "Comcast Completes Acquisition Of GE's 49% Stake In NBCUniversal". Deadline. Retrieved December 17, 2023.
- ^ Leccese, Mark (January 19, 2011). "Comcast/NBC merger: Trouble or trivia?". Boston.com. Archived from the original on January 25, 2011. Retrieved June 2, 2023.
- ^ Goldfarb, Charles B. (February 2010). The Proposed Comcast-NBCUniversal Combination: How It Might Affect the Video Market. Congressional Research Service. p. 21.
- ^ Thierer, Adam (December 2009). "A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC". Progress on Point. 16: 5–8.
- ^ Goldfarb, Charles B. (February 2010). The Proposed Comcast-NBCUniversal Combination: How It Might Affect the Video Market. Congressional Research Service. p. 29.
- ^ Thierer, Adam (December 2009). "A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC". Progress on Point. 16: 10.
- ^ Weinstein, Joshua L. (February 2, 2011). "Mark Lazarus to Head NBC Sports Group's Executive Team". The Wrap. Retrieved October 6, 2012.
- ^ Reynolds, Mike. "Golf Channel, NBC Tee Off As Playing Partners With WGC Tourney". Multichannel News. Retrieved February 21, 2011.
- ^ Fernadez, Bob. "Goodbye Versus, hello NBC Sports Network". The Philadelphia Inquirer. Retrieved August 1, 2011.
- ^ "Kabletown Eerily Takes Over 30 Rock the Same Day Comcast Takes Over NBC". NY Mag. January 27, 2011. Retrieved April 25, 2011.
- ^ Smith, Caitlan (January 28, 2011). "'30 Rock': Mel Gibson Telethons and Reality TV". The Atlantic. Retrieved January 17, 2020.
- ISSN 0362-4331. Retrieved January 17, 2020.