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Comcast-NBC: How will it play in Chicago?

Chicago is the site of an FCC hearing tomorrow because the impact of a proposed Comcast-NBC merger would be particularly dramatic here.  Critics say the merger would mean a less competitive media market, with significant job loss, cable rate increases, and reduced local news coverage.

As detailed at competitioninmedia.org, Chicago is one of eleven cities where Comcast is the dominant cable and internet provider and NBC owns and operates its own TV stations.  Beyond that, Chicago is one of Comcast’s top three markets — and one of only three cities where NBC has a duopoly, operating both NBC (Channel 5) and Telemundo (Channel 44) stations.

“It would put them in a very anti-competitive position,” said Josh Stearns of the media reform group Free Press.  “They could dominate the market and push other broadcast and cable companies out.”

Merging control over content production with distribution means Comcast could restrict access to NBC content for other cable and video providers — or charge them much more dearly.  Down the line there’s the prospect of restrictions on consumer access to online video content.

Combining two local broadcast channels and numerous cable channels with Comcast’s two million cable subscribers in Chicago — with digital boxes delivering detailed information on their viewing habits — the conglomerate could sell “really attractive advertising packages,” including zoned ads, across its broadcast and cable properties, said Steve Macek, a professor of media studies at North Central College in Naperville and activist with Chicago Media Action

“This is a huge issue,” Macek said. A merged Comcast-NBC “will suck up all the advertising in the market,” hurting revenues for other broadcasters and adding pressure among them for more layoffs, especially in newsrooms.  “We’ll see stations cutting back on news staff and perhaps doing away with news altogether.”

This merger — like virtually every media consolidation to date — will lead to fewer journalism jobs, less coverage of the Latino community, and less diversity of voices, said the National Association of Hispanic Journalists in opposing the proposal. 

“We have seen the devastating impact media consolidation has had on newsrooms,” said Ivan Roman in a statement.  He said the public interest commitments made by Comcast in pushing the merger are “troublingly unclear” — and recalled promises by NBC to invest in local stations when it bought Telemundo in 2002.

Instead, “following the merger, NBC gutted the local news operations of Telemundo stations throughout the country.”  While Channel 44’s local newscast wasn’t cancelled, as in other cities, its newsroom was cut back by over a third, by one account.

Significant job loss is routine in giant media mergers, said Macek. “They try to realize savings by combining operations,” he said.  The  opportunity to reduce workforces is “one of the big motivations for these mergers.”

Simply paying off the $8 billion debt required to finance the merger will require job cuts or cable rate hikes, or both, said Seth Rosen, vice president for District 4 of the Communication Workers of America.

“Comcast has promised there will be no massive layoffs,” said Macek.  “Well, that depends on how you interpret ‘massive.'”  There were big job reductions when AOL merged with Time Warner in 2000 (a merger recently called off), at a time of growing ad revenue, he said.  “Now ad revenue is way down. I think there are going to be severe cuts.”

Along with the loss of good jobs, CWA cites the potential for downward pressure on labor standards for remaining workers if a merger reinforces Comcast’s “really aggressive anti-union stance,” Rosen said.

At union workplaces which Comcast has acquired in previous mergers, there’s been “a systematic campaign to get rid of unions,” including refusal to negotiate contracts and support for decertification campaigns, he said.

Of 3,000 Comcast workers in the Chicago area, about 200 are represented by a union, said IBEW Local 21 business representative Jerry Rankins.  That’s what remains from 600 workers at five union shops the company inherited when it acquired AT&T Broadband in 2002.

In negotiations, the company essentially stonewalled, refusing to offer wages and benefits equal to what nonunion employees got, Rankins said; the union filed unfair labor practice charges over the company’s refusal to bargain in good faith, he said.  The company also features compulsory meetings where employees are subjected to anti-union harangues, he said.

Extending Comcast’s reach could undercut telecommunications workers in Illinois, where workers at companies with union representation (notably AT&T) do significantly better in terms of wages and hours, Rankins said. According to CWA, which has a joint Comcast organizing project with IBEW, wages and benefits at Comcast are about a third less than at unionized companies.

Comcast has also replaced regular employees with independent contractors, who get no benefits, Rankins said.

“I am really concerned about Comcast’s overall attitude toward working class people,” he said.  “It’s a moral issue, for the third largest telecommunications company in the country, where the CEO makes $13,000 an hour — they have an obligation to their workers and to the community to pay fair wages and benefits.”

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