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Adelphia takeover OK'd by FCC with strings attached

by Matthew Lasar  Jul 13 2006 - 11:00pm     

By a vote of 4 to 1, the FCC has approved the sale of all of Adelphia Communications Corporations assets to Time-Warner Inc. and Comcast. Devastated by an accounting scandal in 2002, Adelphias cable systems will go to Comcast and Time-Warner for about $17 billion. The two buyers are the nations first and third largest cable companies.

The Commission also attached conditions to the buyout, specifically prohibiting Time-Warner and Comcast from making deals that would deny regional sports programming to their competitors, such as satellite and fiber optic TV. Neither corporation can "unduly or improperly influence" a regional sports networks decision to sell its programming or the price and conditions of its programming, the Commission ruled yesterday.

"I am pleased that the Commission has voted to approve these transactions on a bipartisan basis," FCC Chair Kevin Martin said. "I believe that, on balance, the transactions as conditioned will further the public interest."

But the agencys lone dissenter, Michael Copps, warned that the decision will result in fewer choices for consumers.

"If you live in Pennsylvania, Minnesota, Southern Florida, Washington, D.C., Maryland, Virginia, New England, Western New York, Ohio, Texas, Southern California, North Carolina or South Carolina, you will face increased concentration and all that it entails as a result of these swaps," Copps said. "In some markets, the percentage of homes covered will hover as high as 95 percent."

The decision is particularly unpopular in Comcasts home: Philadelphia. There the FCC made an exception, allowing Comcast exclusive control of Philadelphias sports channel, SportsNet.

"After years of complaints by Philadelphia sports fans that were captive customers of Comcast, the FCC is about to take decisive action—by ignoring us," columnist Jeff Geles bitterly commented in the Philadelphia Inquirer on Wednesday, in anticipation of the ruling.

The new conditions come with enforcement mechanisms. Regional sports networks may arbitrate disputes they have with Comcast and Time-Warner.

But in his approval of the buyout, new Commissioner Robert McDowell called the FCC an "indolent bureaucracy" which moves slowly to act on complaints of undue influence.

"In fact, it seems that many disputes are never resolved," McDowell said. "Why? Because the FCC has not been doing its job. The parties to these complaints deserve better treatment from this Commission."


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