The Federal Communications Commission and the Justice Department have voted to approve Comcast‘s merger with NBC Universal, giving the cable and ISP giant majority ownership of NBC and its media properties, including a piece of Hulu.

By a 4-1 vote, the FCC approved Comcast’s deal with General Electric, the current majority owner of NBC Universal. The Justice Department issued a similar statement declaring that the merger did not violate U.S. antitrust laws.

Under the deal, Comcast will acquire 51% of NBC Universal from General Electric Co. for approximately $13.75 billion. The deal, which has been in the works for over a year, should close before the end of the month.

The regulatory approval came with conditions, though. The majority of the conditions are designed to assure that the new Comcast-NBC entity doesn’t try to hamper the growth of online video.

“Under the proposed settlement and the FCC order, the joint venture must make available to online video distributors (OVDs) the same package of broadcast and cable channels that it sells to traditional video programming distributors,” the Justice Department declared. “In addition, the joint venture must offer an OVD broadcast, cable and film content that is similar to, or better than, the content the distributor receives from any of the joint venture’s programming peers.”

In total, Comcast accepted nine conditions directed by the FCC which will remain in effect for seven years. They include ensuring access to Comcast-NBC programming, protecting the development of online competition, guaranteeing access to Comcast’s programming distribution, protecting content diversity, increasing broadband deployment in low income households, promoting localism, expanding Spanish-language programming, increasing children’s programming and safeguarding educational and governmental programming.

Among the conditions is an agreement by Comcast to follow the FCC’s Open Internet principles, even if a court nullifies the new net neutrality rules the FCC has been crafting.

There are a lot more details available in the FCC’s announcement, but it essentially boils down to the FCC erecting multiple safeguards to protect online video and to prevent Comcast from hoarding its content from others in an attempt to become a monopoly. Still, the new Comcast-NBC entity will have full or partial control of SyFy, G4, E! Entertainment Television, Versus, USA Network, Telemundo, NBC News and NBC. Combine that with its Xfinity operation and its stake in Hulu, and you come up with one of the world’s largest media conglomerates.

While not as shocking as Comcast’s $54 billion attempt to take over Walt Disney Co. in 2004, the new Comcast-NBC entity will be a force to be reckoned with. What happens next is anybody’s guess.

More About: comcast, fcc, nbc, net neutrality, trending

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Arguments have raged across the web during the past week about the Verizon-Google Legislative
Framework Proposal (read the full document). Opinions range from “it’s great” to “this threatens the underlying foundation of the Internet” and “Google’s gone evil”.

This is my take. The proposal primarily affects US Internet users and, although I’m not a US citizen, the issues will almost certainly affect and/or influence other parts of the world. I do not claim to have unbiased opinions or legal expertise. You may agree or disagree; the discussions will continue for many months — probably years.

What is Net Neutrality?

In essence, net neutrality means all web traffic is treated equally. It does not matter whether the user is downloading a Wikipedia article, a YouTube video, a spam email, or an illegally copied MP3 — no data packet has priority over any another.

The Internet operates under this principal … to an extent. Individual ISPs may restrict your bandwidth or perhaps limit torrent downloads during busy periods. Mobile operators usually operate stricter controls to ensure networks remain responsive: they can — and will — block certain content.

The Federal Communications Commission (FCC) had been negotiating with leading providers to outline a framework for the future regulation of US Internet services. This effort was recently abandoned.

What is the Google and Verizon proposal?

The Verizon-Google Legislative Framework Proposal is a response from both companies to the debate in Congress about the National Broadband Plan and the US Government’s role in the future of the Internet.

Google and Verizon are free to make any recommendations they choose. Both companies have an agenda and neither would make a statement that was not in their best interest. Congress can choose to accept, reject or ignore any proposal and the recommendations are not US legislation. Yet.

The key points are summarized below:

1. Non-discrimination against lawful Internet content
A broadband ISP would be prohibited from preventing user access to lawful content or services. The provider must disclose accurate information about their capabilities and network management. The FCC would be responsible for enforcing consumer protection and can impose fines of up to $2 million for companies violating the rules.

These proposals appear reasonable and received the least attention. However, non-discrimination is limited to “lawful” content without clarifying that term or identifying the policing authority. The flip-side of the proposal is that ISPs could block illegal content.

Laws differ from country to country. Even legal practices in one US state may be outlawed in another. Possible issues include:

  • Sectors such as the entertainment industry could argue that certain types of content breach copyright laws. This could include pirated material or works that mention or are influenced by another.
  • Companies could use legal precedents to block competitor services and gain an advantage.
  • Individuals or organizations could use privacy or other laws to block negative articles.

The proposal could hinder free speech and innovation. In addition, an ISP could be exempt from net neutrality principles if it can claim it’s upholding the law. Even a $2 million fine would be a negligible risk to most large carriers — especially if they can profit from prioritizing content.

Finally, it’s interesting to look back to January 2010 when Google threatened to quit China because its Government blocked content which it deemed illegal. How is this different?

2. Network management
ISPs are permitted to engage in reasonable network management to provide a reliable service, e.g. reduce congestion, ensure security, addresses harmful traffic, etc. Many have latched on to this issue as a direct attack on net neutrality but ISPs already engage in the practice. The proposal states they should be transparent and disclose all network management policies.

The most controversial element is Additional Online Services. In effect, ISPs would be free to offer alternative non-internet services which are “distinguishable in scope and purpose from broadband Internet access service”. These services can make use of the internet and prioritize traffic. The FCC would monitor the systems to ensure they do not threaten the meaningful availability of broadband Internet access.

Services such as health and gaming systems have been mentioned, but it’s difficult to evaluate the effect of alternative networks until they’re implemented. It’s unlikely we’ll see separate commercial networks for websites such as YouTube but it remains a possibility. Few people would want to use a fragmented Internet.

3. Exclusion for wireless
With the exception of service transparency, wireless networks are excused from legislation because of their “unique technical and operational characteristics”. This seems strange and many have speculated a conspiracy: Google could want Verizon to prioritize Android devices.

Wireless networks could become the predominant method of net access over the next few years. If that occurs, what is the point of these proposals? Again, there’s no definition of what constitutes a wireless network. Could a cable ISP put a router outside your house, claim they have a wireless network and avoid legislation?

Overall, I find it strange that Google and Verizon have stepped into the political debate. They may be key players but many of the proposals seem too vague to be workable. At worst, the companies appear to be advocating net neutrality exclusions and have been attacked accordingly. The biggest worry is that Congress will approve legislation without an appreciation of the underlying technical issues.

The debate has just begun.