At yesterday’s two Congressional hearings on Comcast and GE’s proposed joint venture for NBC Universal, we heard a diversity of perspectives and viewpoints. While most members had questions, the tone was almost always respectful. We were grateful for the opportunity to answer those questions and address the concerns raised. A number of members didn’t see many issues with the proposed transaction. Overall, we think that Brian and Jeff were able to articulate why this transaction is pro-consumer and strongly in the public interest and we feel that we took an important step forward in the review process of this transaction in Washington.

There were many issues addressed at the hearings, so I’d like to take a moment to cover some of the most discussed topics.

• Jobs: A number of Representatives and Senators asked how the proposed joint venture would impact jobs as our nation continues to suffer high unemployment. As Brian and Jeff responded, there is very little overlap between our two companies. The goal of bringing the companies together is not to cut costs by eliminating jobs, but to grow the company by investing, innovating, and competing. And, not incidentally, the new NBCU will be a 100 percent American-owned company.

• Competition: There was a lot of discussion of a variety of competition-related issues, as well as how this transaction will affect consumers. Brian and Jeff reminded the Congressional committees that this is primarily a vertical combination, bringing together NBCU’s content with Comcast’s multiple distribution platforms. Generally speaking, there is less antitrust concern with a vertical transaction. And that’s the case here.

  The new company won’t have enough economic power at either end of the distribution chain to affect competition, meaning we won’t have the incentive or the capacity to engage in exclusionary or discriminatory conduct. Adam Thierer of the Progress and Freedom Foundation also did a very nice job of rebutting the “creative” antitrust theories espoused by Mark Cooper of the Consumer Federation of America who, recognizing the lack of serious antitrust risks of our joint venture when viewed from a vertical perspective, tried to argue that it really was a horizontal combination. Rep. Stearns, the Ranking Member of the House Telecommunications Subcommittee, also sharply cross examined Dr. Cooper.

  In addition to traditional antitrust and fair competition principles, a combination like this one is also governed by the FCC’s program access and program carriage rules. Over the last week (and at the hearings) some people asked whether we’re being consistent in saying the program access rules will help ensure competition, while at the same time we have filed a court appeal of certain portions of those rules. The short answer is that there is no inconsistency in our position. We have argued and believe that today’s marketplace is sufficiently competitive to do away with those rules, but we have strong reasons to compete fairly whether the rules are in effect or not. We don’t intend to behave any differently than we have under the rules and we’re willing to accept a condition that we abide by those rules, even if the court declares them invalid.

• Broadcast Television: There was a great deal of discussion about the future of the broadcast industry, which faces serious challenges in terms of changing audiences and changing technologies. While we don’t have all of the answers for how we can help solve the broadcast industry’s problems, Brian did reiterate our commitment to free, over-the-air broadcast television. He said that Comcast wants to work with the local broadcast affiliates to help revitalize the broadcast business. And he reinforced our commitment to invest in critical broadcast programming – news, local programming, etc. — and promised that Comcast would be a reliable steward of NBC News, which — we can all agree – is a national treasure. Jeff noted that, in his opinion, Comcast’s commitments to broadcast television and to investing in NBC News were under-appreciated and represented a strong public interest benefit of the transaction.

• Online Video: A number of Representatives and Senators asked how this deal would impact the future of video over the Internet, and some expressed concerns that Comcast and NBCU would try to limit its availability. As Brian has said for several years, video over the Internet is our friend, not our foe, and he explained how we intend to bring more video to the Internet, not less. Brian and Jeff gave some context for the wide-open, highly competitive online video marketplace where Google is by far the leader, with nearly 55 percent of all online viewing – well ahead of Hulu which is in the low single-digits and Comcast’s Fancast which has less than one percent. Overall, Brian and Jeff made the point that it’s our joint vision to help lead the experimentation and innovation that is taking place in the nascent and fast-moving video over the Internet marketplace.

Overall, we thought the hearings went very well. They gave us another opportunity to make our case that this transaction is pro-consumer, pro-competitive, and strongly in the public interest. We also noted the bipartisan calls for an expeditious review by the Justice Department and the FCC. And we were gratified that the committee members not only recognized the extensive voluntary commitments that we have already made, but also how this combination will benefit consumers and drive innovation in the competitive marketplace.

This is Brian L. Roberts statement today before the House Subcommittee on Communications, Technology & the Internet as prepared for delivery:

Oral Statement of Brian L. Roberts
February 4, 2010

Mr. Chairman and Members of the Committee:

Good morning/afternoon.

It’s a privilege to come here today to talk about Comcast’s planned joint venture with GE regarding NBC Universal.

My father, Ralph - sitting just behind me – started Comcast almost half a century ago. He built the company from a single small cable system in Tupelo, Mississippi, to where we are today. With this combination, we are taking the next step in our improbable journey. And this is, indeed, an important moment in our history.

Let me first briefly summarize the transaction.

Under our agreement, Comcast will become majority owner of NBC Universal. We’ll create a new venture that combines NBCU’s broadcast TV, cable programming, movie studio, and theme park businesses with Comcast’s limited video programming channels. Comcast will hold 51 percent of the venture and will manage it, while 49 percent will remain with GE.

This transaction puts two great American communications companies under one roof. It will help to preserve traditional broadcast television – a business that faces serious challenges. And it will also help to accelerate a truly amazing digital future for consumers.

Together, Comcast and NBCU can help to deliver the “anytime, anywhere”, multi-platform video future that Americans want. In combination, we will be a more creative and innovative company that will meet consumer demands. And our success will stimulate our competitors to be more innovative, too. So this joint venture should be good for consumers, innovation, and competition.

To leave no doubt about the benefits of the new NBCU, we have made a series of public interest commitments detailing how we will bring viewers more local programming, more children’s programming, and more diverse programming, on more platforms.

We have also made commitments to reassure our competitors that we will compete fairly in the marketplace. Let me offer two examples. First, the program access rules have never applied to retransmission consent negotiations. But we volunteer to have the key components of these rules apply to our retransmission negotiations for NBC stations.

Second, we want independent programmers with quality content to know that we are determined to help them reach an audience — so we have committed to add at least two new independently owned cable channels to our systems every year beginning in 2011.

*****

The combination of Comcast and NBCU – with no significant overlap between the assets of the companies – is primarily vertical, which generally poses fewer antitrust concerns. That means no massive layoffs – no closures of facilities – nothing to produce hundreds of millions of dollars of “synergies.” That is why some on Wall Street may not love this deal, but this same lack of overlap is why Washington can — because we will grow these great American businesses over the long term and make them more successful, not cut them.

Congress has recognized the benefits of vertical integration before, and adopted rules in 1992 to address potential risks. At that time, there was almost no competition to cable and more than half of the channels were owned by cable companies. So Congress created “program access” and “program carriage” rules to ensure that a company which owns both cable content and distribution cannot treat competitors unfairly.

Those rules have worked in the past and will continue to work. In the last week, some have suggested that our legal challenge to certain portions of the program access rules is inconsistent with our commitments in connection with this transaction. But while we have argued and believe that today’s marketplace is sufficiently competitive to do away with the program access rules, we didn’t pursue this transaction with the intention of not following those rules, and we don’t intend to behave any differently. So we are willing to discuss with the FCC making the program access rules binding on us even if they were to be overturned by the courts. In the past decade, Comcast has come to Washington twice to seek merger approvals, when we acquired cable systems from AT&T and Adelphia. Each time, we explained how consumers would benefit. In each case, I believe we have delivered.

We spent billions of dollars upgrading cable systems to make them state-of-the-art. We created Video On Demand, which our customers have used 14 billion times. And from a standing start four years ago, we now give millions of Americans their first real phone choice.

Once again, we have described how consumers will benefit – and I want to assure you that we will deliver.

Mr. Chairman, we are asking for the opportunity to make one of the great icons of American broadcasting and communications part of the Comcast family. We promise to be reliable stewards for the national treasures of NBC and NBC News. It is a breathtaking, and humbling, moment in our history, and we hope to have your support.

Thank you.

Tomorrow, following our filing with the FCC last week of our Public Interest Statement comprehensively setting forth the public interest case for our planned joint venture with GE regarding NBC Universal, we will continue to make our case in Congress. Comcast Chairman & CEO Brian L. Roberts and NBC Universal President and CEO Jeff Zucker are headed to Washington, DC to appear before two subcommittees on the same day.

In the morning Brian and Jeff will testify before the Subcommittee on Communications, Technology & the Internet chaired by Rep. Rick Boucher, with Ranking Member Cliff Stearns and in the afternoon, they’ll appear before the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights chaired by Sen. Herb Kohl, with Ranking Senator Orrin Hatch. The hearings will be streamed live on the committee’s websites, and C-SPAN 3 will cover the morning hearing live and will archive the footage as well.

Brian and Jeff will be joined at the hearings by witnesses from Consumer Federation of America, the Media Access Project, the NBC affiliates board, WOW (a competing cable company in the Midwest), and the Progress and Freedom Foundation.

We plan to tell the committees why this joint venture makes sense for American consumers and especially for Comcast and NBC Universal customers. The NBC broadcast network reaches almost every American home with a TV - it’s an American icon. For much of the history of TV, NBC was one of only three networks available to viewers. It’s amazing how much broadcasting and cable television have changed since then. From just three broadcast networks, we’ve moved to a world of hundreds of cable networks, not to mention the thousands and thousands of movies and TV choices available On Demand for digital cable customers. We are excited about this joint venture because it will help accelerate the transition to the future of “anytime, anywhere” TV content.

What we hear from our customers every day is they want more - more video programming on demand on their TVs, more online, more on their mobile devices. They want it all and they want it now. We want to bring it to them.

We’ve got a great track record of delivering on innovations that consumers want - like video on demand (VOD), which our customers have now watched 14 billion times over the past six years (that’s much more than the number of iTunes downloads in the U.S. over the same period of time). When we first started VOD, many doubted consumers would embrace it, and we had to work very hard to convince content providers to give us access to their shows. It wasn’t until we made an investment in MGM that we were able to obtain more movies to ramp up our VOD offerings, and that got consumers really interested. We think the same thing will happen with this joint venture - with all the great content of NBC Universal, we can put more On Demand on TV and online (while still respectful of existing distribution windows and business models) and the more we bring to Comcast customers, the more our competitors will bring to their customers as well.

We’ve been visiting with many Members of Congress in the weeks leading up to the hearings, and one thing many Members have asked about is NBC News. To us, no part of NBC Universal is more important. The Today Show and Nightly News with Huntley and Brinkley were part of the daily lives of so many of us when we were growing up. Many of the people we’ve heard from on the Hill also believe that TV programs like Meet the Press have become American institutions and are critical to our democratic process. Because of our strong belief in the importance of broadcast news, on the day we announced this transaction, we pledged to enhance local news and other forms of local programming and to preserve the journalistic independence of NBC News. Expanding on those commitments in our Public Interest Statement last week, we promised to increase local news production by a total of 1,000 hours at the NBC owned and operated stations. We want to preserve the quality, and improve the quantity, of news and public affairs programming around the country - and we’re prepared to invest to do that.

In the current economic environment, broadcasting, like many businesses, is challenged. Before we announced this deal, there was a lot of speculation that we’d turn NBC and Telemundo into cable-only networks. We’ve pledged not to do that (specifically stating our goal to preserve free, over-the-air broadcast television). We want to preserve the local broadcast affiliate model and work with the affiliates of NBC and Telemundo to secure a viable future for the network and affiliates alike.

Another issue we will discuss at the hearings is competition. A few people have said that this transaction will harm competition. We don’t think that’s true - every market we operate in is fiercely competitive, including the distribution, content, and Internet markets. While Comcast may be the largest video provider, the next two largest providers are DirecTV and EchoStar - each of which has a nationwide footprint (we don’t) and both of which compete against us for nearly every customer we have. And Verizon and AT&T (both much larger than Comcast) are now aggressively overbuilding our cable systems all around the country. Even if competition itself wasn’t enough to protect consumers, there are specific FCC rules that require programming owned by a cable company to be shared with competitors, as well as rules that forbid any cable company from favoring programming it owns over other channels. These rules work, and we will of course abide by them (as we do today).

We’re also expecting that there will be discussion of the impact of this transaction on the nascent video over the Internet market. That market is also highly competitive - with many players and very low barriers to entry - and access to content is plentiful. While NBC Universal (through its 32 percent, minority, non-controlling interest in Hulu) and Comcast (through its entertainment and video site Fancast) both participate in this market, our combined share of the market is miniscule (today, that market is dominated by Google/YouTube and populated by dozens and dozens of other sites). We don’t view Hulu and Fancast as competitive - with each other or with our cable service - rather, they are both complementary services. And in any event, we play such a small role in this market (either as a content provider or as an Internet video competitor) that it just isn’t credible to conclude that we have any capacity to get in the way of the development of video over the Internet.

These are just some of the issues we expect Brian and Jeff will address when they testify, and we expect lawmakers will ask a lot of questions. We look forward to this chance to discuss the pro-consumer, pro-competitive, and strong public interest benefits of our proposed joint venture.

I have always considered Black History Month a curious observance. My elementary school lined the halls with posters of Frederick Douglass, Benjamin Banneker, Dr. Charles Drew, Harriet Tubman and many other black history icons. We also recited Martin Luther King Jr’s., I Have a Dream speech. For one month (shortest month of the year) we were free to acknowledge the full scope and breath of the role black folks played in building this country. With the changing of the calendar, as February gave way to March, the posters came down and we returned to our history books with the obligatory chapters on slavery. Even then I would wonder, sometime aloud, why couldn’t we study these remarkable people all year? Why did we only get a month? Needless to say the responses were seldom, if ever, satisfying.

Fortunately I made it out of elementary school with a relatively healthy sense of self that over the years has served me well. And thanks to my role here at Comcast I now have the opportunity to extend the availability of great African American content beyond the days of February. Black Cinema on Demand will showcase the best in African American movies and documentaries and will be available long after Black History Month ends. Great stories featuring African American actors and film makers will be available at the touch of a button.

Access to content that validates ones cultural sensibilities should not be limited to one month but rather available at anytime to all those who want to see it. Now that’s a satisfying answer.

To get to Black Cinema On Demand select “Movies” > “Movie Collections” > “Black Cinema” on your On Demand screen.

Today, Comcast and GE have filed our Applications for Transfer of Licenses and Public Interest Statement with the FCC, which is the next step in the process of our transaction to create a joint venture for NBC Universal. Earlier this week, we filed our Hart-Scott-Rodino notification with the Department of Justice. These two requests for review begin the formal regulatory approval process for this transaction.

Since we made our official announcement to form the joint venture on December 3rd, we have explained that the transaction is pro-consumer, pro-competition, and strongly in the public interest. Our filing today comprehensively reviews the transaction’s specific public interest benefits and how they meet the FCC’s cornerstone interests of diversity, localism, competition, and innovation. By bringing together NBC’s high-quality content with the technology and innovation of Comcast’s technology platform, the new venture will increase the amount, quality, variety, and availability of content more than either company could on its own, which will promote diversity. The new venture will also provide more and better local programming, including local news and information programming, advancing localism. The transaction will spur other content producers and distributors to improve their own services, enhancing competition. Our experimentation with new business models and distribution platforms to better serve consumers will promote innovation.

In our December announcement, we made an unprecedented number of public interest commitments designed to enhance and ensure the strong public interest benefits of the transaction. Our Public Interest Statement expands on these commitments and offers additional details, including the following:

• For three years, the NBC O&Os will provide at least the same amount of local news and information programming as today – and will not cut the amount of news programming.
• A commitment to provide an additional 1,000 hours of local news and information programming by the NBC O&Os.
• An additional 1,500 programming choices for children and families within three years on VOD.
• An additional hour of children’s programming each week (above the current three-hour requirement) using multicast channels of NBC O&Os.
• Tripling the amount of time that program ratings information appears on the screen, from 5 to 15 seconds at each commercial break, and enlarging the information box.
• Launching a new over-the-air multicast channel using Telemundo’s programming library.
• Increasing Telemundo and Mun2 VOD programming by up to 300 additional choices within three years.
• Ensuring that the two new independently owned and operated cable networks we have committed to add to our digital line-up each year for the next three years are truly independent – i.e., networks that are not currently carried by Comcast Cable, and are not affiliated with Comcast, NBCU, or any of the top 15 owners of cable networks as measured by revenues.
• A continued reaffirmation of our commitment to keep NBC as a free-over-the air broadcaster with a workable business model in the evolving economic and technological environment.

The Public Interest Statement details the intensely competitive environment in which NBCU and Comcast operate. In the content market, Comcast today has just a 3% share, and NBCU only 9%, so the new NBCU accounts for only about 12% of overall national cable network advertising and affiliate revenues. Today, NBC is the 4th largest owner of national cable networks, and even after the transaction, the new NBCU will still rank as 4th largest owner of national cable networks, behind Disney/ABC, Time Warner, and Viacom. After the transaction closes, 6 of every 7 channels carried by Comcast Cable will be unaffiliated with Comcast or the new NBCU.

The Public Interest Statement demonstrates that the new combination will not result in the violation of any provisions of the Communications Act, or other applicable statutes or the Commission’s rules, and reviews the already comprehensive regulatory structures in place to assuage any concerns specific to competition in the industry, including program access, program carriage, and retransmission consent rules. And of course, there’s an established body of antitrust law that governs the conduct of all businesses.

With this filing, we initiate what we hope will be a constructive dialogue with the FCC and interested stakeholders, including the general public. Consistent with Commission rules and past practice, this conversation should be limited to legitimate merger-specific issues. As the Commission has said in the past, a transaction review process is not the appropriate forum to air general industry issues or to ventilate imagined or contrived grievances. We are looking forward to a thorough — and expeditious — regulatory review of this transaction, and to working with the Commission, the DOJ, Congress, and other interested parties for a successful completion of this important venture.

Currently, our Comcast High-Speed Internet Service (CHSI) uses Internet Protocol version 4 (IPv4) addresses, such as 192.168.1.1. The supply of IPv4 addresses is limited and will eventually be exhausted. As a result, in order for the Internet to continue to grow, ISPs and other organizations need to transition to IP version 6 (IPv6) addresses, which take a very different form, such as 2001:0db8:4545:3:200:f8ff:fe21:67cf.

Comcast has been a leader in IPv6 development for over 5 years. Our leadership continues today with a plan to conduct real, production-network trials of IPv6 technology this year. The transition from IPv4 addresses to IPv6 addresses is a necessity, as the available pool of IPv4 addresses will at some point be exhausted for all Internet users.

Many experts believe that this transition could be disruptive for Internet users, so the trials we plan to conduct in 2010 will help us identify and solve any areas of difficulty involved in the transition to IPv6. We’ll also use this trial to determine what approach will be the easiest and most seamless for our customers. Comcast will continue to share what we learn with the Internet community, particularly with the IETF, for the benefit of other users of the Internet.

We anticipate conducting several technical trials, with the first trial set to start within the next couple of months. Customers who would like to participate in these IPv6 trials can express their interest using the online form on the new Comcast IPv6 Information Center website at http://www.comcast6.net.

As the Internet Society (ISOC) said in a recent paper, “The Internet Society does not believe that stakeholders have the luxury of taking a wait and see approach or indulging in circular ‘who goes first’ discussions. IPv4 depletion is imminent and the time for moving to IPv6 is nigh. The Internet Society appreciates that many players – such as network operators, hardware manufacturers, handset manufacturers – have made great strides in engaging on this important issue, but, as most would agree, much more needs to be done by all stakeholders. Much greater preparedness for IPv6 – across networks, hardware, and applications is needed. Business continuity and opportunity, and therefore national competitiveness, depend upon it.”

We hope that these trials will encourage other stakeholders to make plans to continue, or to begin, work on IPv6 in 2010 so that all stakeholders do their part in ensuring the future of the Internet is as bright and innovative as it has been in the past.

Internet safety is an important topic, and one that we don’t take lightly here at Comcast. Starting today, all of our high-speed Internet customers can now download Norton Security at no additional cost (for both Mac and PC) from www.comcast.net/security (if you’re a commercial customer you can download Norton Security Suite Business Edition from http://businessclass.comcast.net) Here’s just a sampling of features included with Norton Security Suite:

• Blocks viruses, spyware, Trojans, worms, bots, and rootkits
• Helps protect your identity when you buy, bank, and browse online.
• Identifies unsafe websites and suspicious online sellers
• Helps prevent hackers from taking control of your PC
• Tools to help keep your PC running at peak performance
• Gives you insight into your kids’ online activities. It keeps you in the loop when your kids are online.

The Norton™ Security Suite is a key component to our recently announced Constant Guard Security initiative, which involves a comprehensive approach to proactively assist customers with online security issues. You can find many other best practices by checking out our Security Scene series right here on Comcast Voices.

Tuesday’s devastating earthquake in Haiti has brought an outpouring of sympathy and support from around the world. Our hearts go out to the people of Haiti who have been affected by this disaster, along with their concerned relatives and friends.

Our thoughts are also with members of our Comcast employee family and our customers who have loved ones in Haiti. We wish you strength as aid and rescue efforts continue in the coming days.

During my first year with Comcast I’ve learned that the company has an extensive history of giving back – whether for local community projects or in response to natural disasters in the United States and around the world.

To help support the earthquake victims, and on behalf of all Comcasters, Comcast has pledged over $1 million in cash and in-kind support, which includes grants from the comcast foundation to the American Red Cross and to Télécoms Sans Frontières (Telecom without Borders), a nonprofit agency already operational in Haiti that brings telecommunications services to crisis zones, and free air time across our networks for earthquake-related public service announcements from the Red Cross, United Way, and the National Cable and Telecommunications Association (which together with the Ad Council has been working to quickly prepare PSAs for airing, some of which feature First Lady Michelle Obama).

If you are considering making a personal donation, here are links to three organizations that have been featured most prominently in media reports this week. They are the American Red Cross, United Way International, and the Clinton Bush Haiti Fund:

• http://www.redcross.org/
• https://volunteer.united-e-way.org/uwwwdisaster/donate/
• http://www.clintonbushhaitifund.org/

Visit Comcast.net for information, articles, and more ways to donate.

These centralized efforts will supplement some of the terrific steps already launched in our local systems around the country. For example, in Miami-Dade County, we are supporting an information and communications hub for the Haitian community at the Edison Little River Neighborhood Center. Our CDV services will help residents contact family and friends in Haiti, at no cost.