[opendtv] Comcast Shares Sink on NBCU Speculation
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Fri, 2 Oct 2009 16:14:22 -0500
Craig used to say that the way to fix US OTA TV is to "separate content from
carriage." I disagreed often with this notion, because what Craig was
advocating was to create a monopolistic "spectrum utility," where no such
monopoly was techincally necessary in the OTA realm.
Maybe there is a compromise position. Separating content from carriage seems
exactly right in this instance. It is in Comcast's self-interest to prevent any
NBC content from being made available FOTA. At the same time, the public
spectrum is owned by us, the people, and only entrusted to NBC now, to use as
prescribed by law.
The public should not allow publically owned assets to go into the hands of
those who benefit from their misuse (or non-use). Sale of NBC to a cable
company that benefits from NOT correctly using the public OTA asset should
therefore be viewed as a "conflict of interest." So, NBC content should be
separated from NBC OTA O&O stations, to resolve the conflict of interest.
Remove the national caps, retain the local caps, and let a company interested
in NBC's OTA assets put them to good use.
Bert
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http://www.tvtechnology.com/article/88122
Comcast Shares Sink on NBCU Speculation
10.02.2009.
Shares of Comcast dropped around 7 percent on Thursday on speculation the cable
operator might buy NBC Universal from General Electric. Wells Fargo Marci
Ryvicker said the deal would make sense as far as the cable assets were
concerned, but the broadcast network would be a red-headed stepchild.
"In our view, an acquisition of NBCU makes sense as it relates to the cable
networks," Ryvicker said. "But the other assets--broadcast network, the O&O
stations and the theme park units--do not."
Steve Burke, Comcast's chief operating officer, has talked about diversifying
the company's assets, which now comprise 95 percent distribution and 5 percent
content, Ryvicker said.
"That being said, Mr. Burke also stated that the company is not looking to make
a '$50 billion acquisition' --although we believe that NBC Universal is worth
well below that," she said. "CNBC is reporting that the potential transaction
between Comcast and GE would entail the spin-off of NBCU into a private company
with Comcast taking a 51 percent ownership stake. Should this happen, Comcast
would be on the hook for $13 billion."
Wells Fargo considers $13 billion preferable to the likely full price of NBCU
of around $35 billion.
"While the company is not commenting, other than to say that speculation of a
finalized $35 billion acquisition of NBCU is untrue, we do think that Comcast
and GE are in the valuation process," Ryvicker said. "The stock is likely to
remain under pressure until there is a formal announcement from either company
as to the structure and size of what's to come."
Comcast (NASDAQ: CMCSA) dropped 7 percent to around $15.70 in trading Thursday;
GE (NYSE: GE) dipped just under 3 percent to a few pennies below $16.
"Once the uncertainties are ironed out, we expect the stock to recover
somewhat--although investors married to the free cash-flow story may flee to a
relatively 'safer' company, such as Time Warner Cable, which has repeatedly
stated its desire to stay out of the M&A market and use its excess cash to
delever and return money to shareholders via a dividend," Ryvicker said.
Wells Fargo remains neutral on Comcast. -- Deborah D. McAdams
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