[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]


 
     COMPETITION IN THE MEDIA AND ENTERTAINMENT DISTRIBUTION MARKET

=======================================================================

                                HEARING

                               BEFORE THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                           FEBRUARY 25, 2010

                               __________

                           Serial No. 111-121

                               __________

         Printed for the use of the Committee on the Judiciary


      Available via the World Wide Web: http://judiciary.house.gov



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                       COMMITTEE ON THE JUDICIARY

                 JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California         LAMAR SMITH, Texas
RICK BOUCHER, Virginia               F. JAMES SENSENBRENNER, Jr., 
JERROLD NADLER, New York                 Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia  HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina       ELTON GALLEGLY, California
ZOE LOFGREN, California              BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas            DANIEL E. LUNGREN, California
MAXINE WATERS, California            DARRELL E. ISSA, California
WILLIAM D. DELAHUNT, Massachusetts   J. RANDY FORBES, Virginia
STEVE COHEN, Tennessee               STEVE KING, Iowa
HENRY C. ``HANK'' JOHNSON, Jr.,      TRENT FRANKS, Arizona
  Georgia                            LOUIE GOHMERT, Texas
PEDRO PIERLUISI, Puerto Rico         JIM JORDAN, Ohio
MIKE QUIGLEY, Illinois               TED POE, Texas
JUDY CHU, California                 JASON CHAFFETZ, Utah
LUIS V. GUTIERREZ, Illinois          TOM ROONEY, Florida
TAMMY BALDWIN, Wisconsin             GREGG HARPER, Mississippi
CHARLES A. GONZALEZ, Texas
ANTHONY D. WEINER, New York
ADAM B. SCHIFF, California
LINDA T. SANCHEZ, California
DEBBIE WASSERMAN SCHULTZ, Florida
DANIEL MAFFEI, New York
[Vacant]

       Perry Apelbaum, Majority Staff Director and Chief Counsel
      Sean McLaughlin, Minority Chief of Staff and General Counsel


                            C O N T E N T S

                              ----------                              

                           FEBRUARY 25, 2010

                                                                   Page

                           OPENING STATEMENTS

The Honorable John Conyers, Jr., a Representative in Congress 
  from the State of Michigan, and Chairman, Committee on the 
  Judiciary......................................................     1
The Honorable Lamar Smith, a Representative in Congress from the 
  State of Texas, and Ranking Member, Committee on the Judiciary.     5
The Honorable Zoe Lofgren, a Representative in Congress from the 
  State of California, and Member, Committee on the Judiciary....     7
The Honorable Gregg Harper, a Representative in Congress from the 
  State of Mississippi, and Member, Committee on the Judiciary...     7
The Honorable Henry C. ``Hank'' Johnson, Jr., a Representative in 
  Congress from the State of Georgia, and Member, Committee on 
  the Judiciary..................................................     7
The Honorable Adam B. Schiff, a Representative in Congress from 
  the State of California, and Member, Committee on the Judiciary     8

                               WITNESSES

Mr. Brian L. Roberts, Chairman and CEO, Comcast Corporation, 
  Philadelphia, PA
  Oral Testimony.................................................     9
  Joint Prepared Statement.......................................    13
Mr. Jeff Zucker, President and CEO, NBC Universal, New York, NY
  Oral Testimony.................................................    10
  Joint Prepared Statement.......................................    13
Ms. Jean Prewitt, President and CEO, Independent Film and 
  Television Alliance, Los Angeles, CA
  Oral Testimony.................................................    29
  Prepared Statement.............................................    31
Mr. Thomas W. Hazlett, Professor of Law and Economics, George 
  Mason University School of Law, Arlington, VA
  Oral Testimony.................................................    38
  Prepared Statement.............................................    40
Dr. Mark Cooper, Ph.D., Director of Research, Consumer Federation 
  of America, Washington, DC
  Oral Testimony.................................................    43
  Prepared Statement.............................................    45
Mr. Larry Cohen, President, Communications Workers of America, 
  Washington, DC
  Oral Testimony.................................................    58
  Prepared Statement.............................................    59
Mr. Andrew Jay Schwartzman, President and CEO, Media Access 
  Project, Washington, DC
  Oral Testimony.................................................    72
  Prepared Statement.............................................    74
Mr. Marc H. Morial, President and CEO, National Urban League, New 
  York, NY
  Oral Testimony.................................................    82
  Prepared Statement.............................................    84

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

Prepared Statement of the Honorable John Conyers, Jr., a 
  Representative in Congress from the State of Michigan, and 
  Chairman, Committee on the Judiciary...........................     3

                                APPENDIX

Material Submitted for the Hearing Record........................   151


     COMPETITION IN THE MEDIA AND ENTERTAINMENT DISTRIBUTION MARKET

                              ----------                              


                      THURSDAY, FEBRUARY 25, 2010

                          House of Representatives,
                                Committee on the Judiciary,
                                                    Washington, DC.

    The Committee met, pursuant to notice, at 10:04 a.m., in 
room 2141, Rayburn House Office Building, the Honorable John 
Conyers, Jr. (Chairman of the Committee) presiding.
    Present: Representatives Conyers, Berman, Nadler, Lofgren, 
Jackson Lee, Waters, Cohen, Johnson, Pierluisi, Quigley, Chu, 
Gutierrez, Gonzalez, Wiener, Schiff, Sanchez, Maffei, Smith, 
Sensenbrenner, Coble, Goodlatte, Lungren, Issa, Forbes, Franks, 
Gohmert, Poe, Chaffetz, Rooney, and Harper.
    Staff present: (Majority) Perry Apelbaum, Staff Director 
and Chief Counsel; Christel Sheppard, Counsel; (Minority) Sean 
McLaughlin, Chief of Staff and General Counsel; and Stewart 
Jeffries, Counsel.
    Mr. Conyers. The Committee will come to order.
    We are in a difficult situation in terms of our economy. We 
are coming out of a financial crisis that was triggered by the 
prime mortgage--subprime mortgage meltdown. We have invested 
over $1.5 trillion in the economy, finally turning toward 
creation of jobs.
    I remember that since the Clinton administration, there has 
been consolidation, takeover and mergers unparalleled in 
American economic history, only slightly down-turned in number 
and scope over the last several years. And I must say that I 
have always been alarmed about these combinations that have 
developed in our economy. I have never thought that the 
antitrust division had operated with any real effectiveness.
    And I start off this discussion this morning with the 
suspicion that there are cases in which vertical mergers can be 
more dangerous than horizontal mergers and that the role of the 
Internet and--versus the role of cable is something we have got 
to begin to look at on a far larger basis than the one proposed 
merger before this Committee this morning.
    And, of course, I have never yet entertained a merger 
discussion in which there was complete assurance that there 
would be no diminution of jobs, never. And never has that ever 
happened. There was always job loss.
    There are now places in Michigan in which 30 percent of its 
population is unemployed. There are places that would meet the 
definition of a depression before the crisis that caused so 
much angst. And now we have a proposal before us that I am 
approaching very carefully.
    And I will put my statement in the record, make it 
available, and I would like our Ranking Member, who has worked 
with me more closely and in a way without compromising his own 
point of view, but where he and I and this Committee could 
reach agreement as we did with the considerations that were on 
the floor just last night.
    I wanted to thank him and the Committee for the close 
scrutiny that we gave each other's approach to these very 
important problems. And I recognize Mr. Smith of Texas, the 
Ranking Member.
    [The prepared statement of Mr. Conyers follows:]

    
    
    
    
    
    
                               __________

    Mr. Smith. Thank you, Mr. Chairman. And I appreciate those 
very generous words.
    I think you were surprised that I supported you last night 
on the House floor, but as you just mentioned, there are times 
and often times when we do work together, and that is a source 
of real satisfaction to me, and I think it is good for the 
Committee, as well. And I thank you for all the courtesies you 
have extended us on this side.
    Mr. Chairman, vigorous unimpeded competition sustains our 
economy and keeps it strong. It leads to innovative products 
that keep prices low and better our lives. Today's hearing 
gives us the opportunity to examine the proposed merger of 
Comcast and NBC Universal, a combination that would create one 
of the world's largest entertainment companies.
    The combined company would own significant assets in video 
distribution, video production, movie production, and the 
emerging world of Internet video programming. However, this 
proposed merger is not completely typical of the mergers that 
this Committee and the Department of Justice usually review.
    Normally, we look at mergers between head-to-head 
competitors, such as Delta-Northwest Airlines and XM and 
Sirius. This hearing is more akin to the Live Nation and 
Ticketmaster deal that this Committee reviewed almost exactly a 
year ago.
    Both Comcast and NBC Universal own some video production 
assets. However, the more compelling question is whether a 
vertically integrated company that has a significant hand in 
video production and distribution can use its leverage in one 
area to raise prices in another. In other words, can a combined 
company use Comcast's significant presence in cable 
distribution to limit its rival's access to NBC's programming?
    Comcast argues--and argues forcefully--that the Federal 
Communications Commission's carriage rules does prevent it from 
discriminating against its rivals in such a way. And that, I 
might add, Mr. Chairman, is a persuasive argument.
    Finally, the combined company will still control one of the 
preeminent news reporting industries in the world, NBC News. I 
raised this concern in other circumstances, and I continue to 
worry that media consolidation contributes to the persistent 
problem of media bias.
    All that said, though, Comcast and NBC Universal have made 
significant commitments in their public interest filing with 
the SEC and in earlier hearings on Capitol Hill. Those 
commitments lead me to believe that this merger could, in fact, 
help consumers.
    In addition, past experience, such as the ownership of Time 
Warner Cable by Time Warner has not led to the dire 
consequences that some opponents suggested. The fact that Time 
Warner has now separated itself from Time Warner Cable might 
cause one to consider whether this is a wise business venture. 
However, that is less an issue of antitrust law and public 
policy than it is a question for Comcast shareholders.
    Mr. Chairman, I would like to thank our witnesses for being 
here today. And of course, I look forward to hearing their 
testimony momentarily. Yield back.
    Mr. Conyers. Thank you very much.
    Did any Members on this side of the dais wish to make any 
opening comments?
    Ms. Lofgren. Mr. Chairman? Mr. Chairman?
    Mr. Conyers. Zoe Lofgren?
    Ms. Lofgren. I will be very quick. First, I want to thank 
you for holding this hearing. I think it is very important. And 
there are a multitude of issues presented in the merger. I 
think we will learn a lot by the discussion today, but a very 
particular interest to me is the potential or questions or 
issue, perhaps, is a better, more neutral way to pose it of 
whether this merger will affect the growth of TV delivery over 
the Internet and whatever impact this merger could have on the 
whole net neutrality challenge that faces the country.
    And I am hoping that the witnesses will address these 
issues. And in the interest of hearing from them soon, I will 
stop now and yield back with great thanks.
    Mr. Conyers. Gregg Harper?
    Mr. Harper. Thank you, Mr. Chairman. I move to strike the 
last word.
    Mr. Conyers. Gentleman is recognized.
    Mr. Harper. Mr. Ralph Roberts, who is with us today, 
started the Comcast family in my home state of Mississippi. Mr. 
Roberts founded American Cable Systems, now Comcast, in 1963 in 
Tupelo, Mississippi, in an effort to provide content to 
consumers in a small valley town that could not receive a 
decent signal from antennas in Memphis, Tennessee.
    Mr. Roberts and others involved in launching American Cable 
Systems took a risk to provide consumers with a much wanted 
source of entertainment. Comcast is now taking another risk to 
provide their customers with an even better product.
    Over the years, the Roberts family has built their company 
into a very successful business. Now Comcast is making an 
effort to expand on the American dream of building a successful 
company from the ground up by merging with NBC Universal.
    My hope is that the merger will receive a thorough and 
speedy examination and that the Comcast family is successful in 
their future endeavors to provide quality service to their 
customers.
    With that, Mr. Chairman, I yield back.
    Mr. Conyers. Subcommittee Chairman Hank Johnson?
    Mr. Johnson. Thank you, Mr. Chairman, for holding this very 
important hearing today.
    The media and entertainment distribution market is 
continually evolving to meet consumer demand and new 
technology. Neither Congress nor the Department of Justice 
should stop progress, but as Chair of the Subcommittee on 
Courts and Competition Policy, I believe we must ensure that 
mergers and consolidation in this market do not harm 
competition.
    The specific merger between Comcast and NBC raises 
important questions about what kind of control the combined 
entity would have over distribution and programming and whether 
the new entity could leverage the acquisition to restrict 
access to NBC programming on the Internet.
    I am also concerned about the possibilities that jobs will 
be lost in the transaction. I understand that Comcast has 
stated that no jobs will be lost in the merger, but I find it 
hard to believe that any merger can occur without some job 
loss.
    In addition, with any media consolidation--excuse me--there 
is also a risk that local voices will be lost. I understand 
that Comcast has made a commitment in its public interest 
filing that it intends to preserve and enrich the output of 
local news, local public affairs, and other public programming 
on NBC owned by owned and operated stations.
    I hope to hear the witnesses today specifically discuss 
what steps they plan to take to ensure that there will be no 
impact on journalistic independence of the information that 
consumers receive. Very important that our airwaves--our public 
airwaves be filled with factual data for people to make their 
own conclusions about situations that are occurring, as opposed 
to just simply a lot of editorial entertainers posing as news 
people.
    I also want to hear the parties to the merger discuss how 
consumers will have increased access to diverse and independent 
programming, including sports programming, a matter that is 
close to the heart of my compatriot, Mr. Cohen.
    In particular, I am concerned that Comcast will be able to 
bundle its regional sports network in Atlanta with NBCU's 
popular programming to drive up costs for other pay television 
providers. Such an action would limit access to local sports 
teams and hurt consumers who will ultimately bear the increased 
costs.
    And with that, Mr. Chairman, I will yield back.
    Mr. Conyers. Thank you.
    Adam Schiff?
    Mr. Schiff. Thank you, Mr. Chairman. And I very much 
appreciate your scheduling this hearing. I have a great 
interest in the subject matter, not the least of which between 
NBC and Universal have been either headquartered in or adjacent 
to my district ever since I have been to Congress and long 
before I got there.
    So it will greatly affect my constituents. I will be very 
interested to hear the panel's thoughts in terms of the impact 
on jobs, and I appreciate the time I have had to discuss the 
issue with Mr. Zucker, and I understand the vertical nature of 
the proposed merger and was very pleased to hear that there are 
no intended job cuts as a result of the merger.
    I think that one of the issues I will be interested in 
exploring--and I don't know that it has been as much on the 
table as some of the others--is the impact on intellectual 
property and the protection of intellectual property, another 
issue of key concern to my constituents and people all around 
the country.
    I think there may be a synergy here that could be very 
constructive in the sense that NBC has always been concerned 
about intellectual property, being content creators. The 
pipeline companies have often had different perspectives, and 
at times, the content makers and the content deliverers have 
not always seen the issue eye to eye.
    One potential benefit from the merger may be that it brings 
the pipeline much more into the business of protecting 
intellectual property because it will have an interest in 
making sure it protects the content of NBC to a greater degree 
than perhaps it did as a separate entity. So I will be 
interested to hear the panel's thoughts of whether that 
conjecture is right or whether I am completely off the mark.
    And so I greatly look forward to the testimony today and 
appreciate, Mr. Chairman, your putting this distinguished panel 
together, and yield back the balance of my time.
    Mr. Conyers. We welcome witnesses Andrew Jay Schwartzman, 
president of Media Access Project, Larry Cohen, president of 
Communications Workers of America, Dr. Mark Cooper, director of 
research, Consumer Federation of America, Ms. Jean Prewitt, 
Independent Film and Television Alliance, Mr. Jeff Zucker, 
president, CEO, NBC Universal, and our first witness, Mr. Brian 
Roberts, chairman and CEO of Comcast.
    He brings his father with him today. And from the time his 
father started the company that was referred to by our 
colleague from Mississippi, it is now a Fortune 100 company, 23 
million customers, 100,000 employees, and in addition, our 
first witness serves as a member of the board of directors of 
the National Cable and Telecommunications Association.
    All statements will be entered into the record.
    And, Mr. Roberts, we welcome you this morning.

   TESTIMONY OF BRIAN L. ROBERTS, CHAIRMAN AND CEO, COMCAST 
                 CORPORATION, PHILADELPHIA, PA

    Mr. Roberts. Thank you, Mr. Chairman and Members of the 
Committee. It really is a privilege to come here today to talk 
about Comcast's planned joint venture with GE regarding NBC 
Universal.
    As Congressman Harper nicely stated, my father, Ralph, 
indeed started Comcast almost a half of a century ago with a 
single small cable system. Together we have been able to build 
Comcast into a national cable, broadband, and communications 
company employing over 100,000 people today.
    In proposing to combine with NBC Universal, we are taking 
the next step in our improbable journey. This is indeed an 
important moment in Comcast's history.
    So let me first briefly summarize the transaction. Under 
our agreement, Comcast will become the majority owner of NBC 
Universal; and will 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 manage it, 
while 49 percent will remain with GE.
    The transaction puts two great American media and 
entertainment companies under one roof. It will help to deliver 
more diverse programming to millions of households, and it will 
also help to accelerate a truly amazing digital future for 
consumers.
    Together, Comcast and NBCU can help deliver the anytime, 
anywhere, multiplatform video experience Americans want. In 
combination, we will be a more creative and innovative company. 
And our success will stimulate our competitors to be more 
innovative, too. So this joint venture will 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 in writing 
detailing how we will bring 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, we volunteer to have the key components of the 
program access rules apply to our retransmission negotiations 
for NBC stations, even though those rules have never applied to 
retransmission consent negotiations.
    Second, we want independent programmers with quality and 
diverse content to know we are committed 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.
    Bringing NBCU and Comcast together is a primarily vertical 
combination. There is no significant overlap between the two 
companies. A vertical combination generally poses fewer 
competitive concerns. This means no massive layoffs, no closure 
of facilities, nothing to produce hundreds of millions of 
dollars of synergies.
    That is why, as has been noted, some on Wall Street did not 
initially fall in love with this deal right away. But it is 
also why we believe 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 the 
potential risks. At that time, there was almost no competition 
to cable, and more than half of all 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. And we are willing to discuss with the FCC having the 
program access rules bind 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, and in each case, I believe we have delivered.
    We have 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 4 years ago, we now give millions of Americans 
their first real competitive choice of phone provider.
    We have also created thousands of jobs and promoted 
diversity in our workforce.
    Once again, we have described how consumers will benefit, 
and I want to assure you that we plan to deliver.
    Mr. Chairman, we are asking for the opportunity to make one 
of the great icons of American broadcast 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.
                               __________

    Mr. Conyers. Thank you.
    I want to make sure that everyone knows that Professor 
Thomas Hazlett is here from George Mason University. He was the 
chief economist at the FCC in 1991.
    Welcome, sir.
    We now call on Jeffrey Zucker, president, chief executive 
officer of NBC, at one time the youngest executive producer of 
``The Today Show'' and ultimately became president of NBC 
Entertainment and was promoted to his current position in 2007.
    Welcome to the hearing, sir.

         TESTIMONY OF JEFF ZUCKER, PRESIDENT AND CEO, 
                  NBC UNIVERSAL, NEW YORK, NY

    Mr. Zucker. Thank you, Mr. Chairman.
    Mr. Chairman, Members of the Committee, thank you for the 
opportunity to testify today. As the president and CEO of NBC 
Universal, I am proud to lead an iconic media company shaped by 
two great American brands, NBC and Universal, and I am grateful 
for the opportunity to tell you how the proposed venture 
between Comcast and General Electric will help NBC Universal 
thrive and also benefit our employees, the creative community, 
the goals of diversity, and our ability to meet the demands of 
21st century American consumers.
    In today's intensely competitive and dynamic media markets, 
this deal is critical to realizing these benefits. That is what 
makes me so excited about this deal with Comcast. At a time of 
tremendous change and fierce competition in the media 
marketplace, Comcast is committed to invest at NBC Universal 
and to share its delivery expertise and innovative vision. We 
need to take advantage of new digital distribution 
capabilities, On Demand, online, mobile, and beyond, to be a 
leader in delivering content to consumers where they want it, 
when they want it, and how they want it.
    Comcast's investment in NBCU, married with its history of 
delivery innovation and technological vision, will help us meet 
the demands of the 21st-century consumer. In short, two words--
investment and innovation--capture the benefits that Comcast 
will bring to NBCU.
    Let me also say a few words about key issues that I know 
are important to Members of this Committee, first, competition. 
This is not your father's media market. Less than 40 years ago, 
three companies enjoyed 90 percent of all television viewing. 
Today, the world could not be more different.
    Each of the five largest media companies in America now 
only account for between 5 percent and 10 percent of all 
viewing. And a multitude of smaller competitors actually 
account for approximately half of all television viewing.
    The new NBCU's cable channel business, where we will add 
Comcast networks, will be ranked fourth by revenue among owners 
of national cable networks. But that is only part of the 
picture.
    People today choose not only between broadcast and cable 
television, but also increasing look to the Internet, Xbox, 
iPhone, PlayStation, and so many other new platforms and 
technologies for their media choices. There will be more change 
in our space in the next 5 years than there has been in the 
last 50.
    This deal will not change this fundamental competitive 
dynamic or the extraordinary rate of technological change, but 
it will help NBC Universal compete in the new media world.
    Second, diversity. I have made diversity one of my top five 
strategic priorities as CEO, and I am proud of our record at 
NBC Universal. We have an extraordinarily diverse employee 
population and a diverse executive team, and I see the benefits 
of this diversity every day.
    Third, jobs. Comcast's investment in NBCU means that our 
workforce will not face the layoffs typical of so many mergers. 
Moreover, Comcast is committed to our existing labor-management 
relationships and will honor all of our collective bargaining 
agreements. I see a brighter future not just for the talented 
employees at NBCU who produce our high-quality content such as 
the Olympics we have been so proud to air over the last 2 
weeks, but also for other creators, as NBCU invests in more and 
better programming and spurs our competition to do the same.
    Fourth, intellectual property protection. This deal 
provides an important opportunity to address critical concerns 
about piracy and digital theft, an issue that this Committee 
knows all too well.
    Fifth, over-the-air broadcasting. Comcast's investment also 
means that we can reinvigorate the broadcast side of the 
business. Comcast's commitment to over-the-air broadcasting has 
been widely underappreciated, but is great news for the 
American public that we serve. Comcast's commitment to over-
the-air broadcasts leads to a more vibrant NBC and Telemundo, 
for the benefit of our viewers nationwide.
    Let me close by saying how grateful I am for GE's excellent 
stewardship of NBC Universal. GE has invested more than $22 
billion since 2000 and built NBCU into the diversified and 
vibrant broadcast, film, cable programming, and media company 
that we are today. With this deal, GE will now have billions of 
dollars to invest in new technologies and jobs in its core 
businesses.
    I could not be more excited about the future of this 
company for the NBCU family, including our employees, as well 
as our audience. The investments in innovation this deal will 
bring are essential if we are to remain a vigorous competitor 
in the 21st-century media market and a growing source of high-
wage jobs in an economy starved for employment.
    Thank you for the opportunity to testify, and I look 
forward to any questions that this Committee may have.
    [The joint prepared statement of Mr. Roberts and Mr. Zucker 
follows:]

             Joint Prepared Statement of Brian L. Roberts 
                            and Jeff Zucker


































                               __________
    Mr. Conyers. Our next witness is Jean Prewitt, who has been 
a lawyer, senior vice president, general counsel, United 
International Pictures, foreign distribution affiliate of 
Paramount, Universal and MGM Studios, and since 2000 has been 
president and CEO of Independent Film and Television Alliance.
    Welcome.

TESTIMONY OF JEAN PREWITT, PRESIDENT AND CEO, INDEPENDENT FILM 
            AND TELEVISION ALLIANCE, LOS ANGELES, CA

    Ms. Prewitt. Thank you, Mr. Chairman and Members of the 
Committee.
    In an era of media giants, I am here to speak for the 
independents. The independents are the workhorses of this 
industry. They produce 70 percent of the feature films. They 
account for the vast majority of jobs in that sector. They 
introduce new talent to the industry, and they are 
distinguished by the fact that they finance their product from 
outside the five major studios.
    Since 1982, IFTA and its members have produced, distributed 
and financed more than 63 percent of the Academy Award best 
pictures. This season's--this year's award season has already 
honored ``The Hurt Locker,'' ``Precious,'' and ``The Last 
Station,'' and we expect those honors to continue over the next 
week.
    The issue before us today is whether America will continue 
to be informed, entertained, and challenged by varied voices. 
The answer matters. Independent TV series and films have 
changed how Americans think, how we live, and how we structure 
our society.
    ``The Cosby Show'' was produced by an independent, and it 
changed racial attitudes. ``Gandhi,'' ``Crash,'' and ``Million 
Dollar Baby'' prompted public discussion of important issues, 
and they were produced by independents.
    This merger must not deny the public access to new 
messengers and new messages. We know why Comcast and NBC want 
this merger. Comcast is buying NBC so that it can own more TV 
shows and more feature films. They look forward to cost 
savings. They look forward to synergies as they fuel new 
platforms.
    But this will come from the capacity to leverage their own 
programming across many platforms, from free TV to cable to 
Video On Demand to the Internet. They avoid the transaction 
costs, they say, of having to deal with third parties or 
independents in acquiring that programming.
    For the past 15 years, investment decisions and regulatory 
rulings have thwarted independents' diversity and creativity. 
Vertical integration has combined studios, broadcast and cable 
networks into a few conglomerates. A handful of executives now 
decide how, when and whether programs will reach the public. 
They are closing the door on diversity, and we must do whatever 
we can to pry that door open today.
    Make no mistake: What is good for Comcast and NBC in this 
merger isn't good for the American public. The proposed merger 
will simply create more consolidation. It must not go forward 
without clear commitments and conditions to protect the public 
interest in diverse programming and varied voices.
    Five major conglomerates now own the national broadcast 
networks and 24 out of 29 of the top cable channels that 
feature entertainment programming. These five companies produce 
over 80 percent of all entertainment programming on primetime 
and, importantly, on the three major children's networks.
    Meanwhile, the percentage of independently produced series 
on the networks has declined from 50 percent in 1989 to 5 
percent in 2008. What has happened? Since 2002, the major 
outlets for independent programming have been confined to a 
handful of basic cable channels which buy limited numbers of 
movies of the week, feature films, and scattered other 
programming. Many of those channels, from G4 to Syfy to USA, 
will become part of this new combined company, and that is just 
today's media.
    This merger can also exclude independent programming from 
Comcast's valuable Video On Demand space and its new proposed 
Internet offerings. History will repeat itself, and the 
independents will be shut out of the new emerging platforms in 
exactly the same way they have now been shut out of broadcast 
television and cable television.
    At this crucial moment, the Committee has the power to 
raise the questions that will advance American values of 
diversity, creativity, and freedom of expression. Will 
Americans enjoy greater diversity of choices and voices? Will 
the public have access to the next ``Cosby'' or the next ``Mad 
Men''? Or will our choices be narrowed at a time when new 
technology should be liberating, not limiting, our sources of 
information and entertainment?
    The answer must be strong conditions placed on this merger 
to preserve the diversity of voices that we would expect in the 
American entertainment sector.
    Thank you for allowing me to speak for the independents 
today.
    [The prepared statement of Ms. Prewitt follows:]

                   Prepared Statement of Jean Prewitt















                               __________

    Mr. Conyers. Professor Thomas Hazlett, professor of law and 
economics, George Mason University, chief economist of the 
Federal Communications Commission, author of the book ``Public 
Policy Toward Cable Television,'' director of Information 
Economy Project, an expert on government regulation of the 
media, and a person of a vast combination of experiences and 
law and education.
    I am pleased that you are here today.

TESTIMONY OF THOMAS W. HAZLETT, PROFESSOR OF LAW AND ECONOMICS, 
      GEORGE MASON UNIVERSITY SCHOOL OF LAW, ARLINGTON, VA

    Mr. Hazlett. Thank you very much, Mr. Chairman, also, 
somebody who was late to the hearing. And for that, I 
apologize.
    Quickly on the competitive analysis, the merger before the 
Committee today is primarily a vertical combination where 
Comcast, a cable operator distributing video programming to 
millions of household subscribers, is acquiring ownership of 
additional programming assets. This does not lessen competition 
in any market, but allows the content distributor to achieve 
efficiencies by producing complementary products.
    There are special cases in which vertical integration can 
lead to anti-competitive foreclosure, but the evidence 
indicates that these special circumstances do not apply. 
Studies of vertical integration in cable generally confirm the 
baseline analysis. Efficiencies typically result when firms 
elect to combine programming and distribution.
    As an empirical matter, the trend in the sector is away 
from vertical integration, meaning that operators do not 
believe they can increase profits via vertical foreclosure. The 
ownership of cable program networks has sharply declined over 
the past 2 decades by operators. The spin-off of cable TV 
systems by Viacom in 1996 and Time Warner in 2008 are key 
components of this trend.
    In video programming, there is a horizontal aspect to the 
combination. Comcast currently owns some cable network assets, 
and these will merge with direct rivals owned by General 
Electric. But the Comcast share is meek combined with NBC 
Universal program assets that will account for only about 12 
percent of total U.S. cable program network revenues.
    The good news for consumers and programmers in recent years 
is that local market competition has, at long last, taken off. 
Twenty years ago, one local cable TV system dominated multi-
channel video program distribution in each franchise area. 
Today, there are over three competitors per market on average: 
the local cable operator, two satellite TV rivals, each with a 
national footprint, and coming up on almost half the country 
now, a telco TV provider. Nothing in the Comcast-GE deal 
threatens to disturb this trend.
    Finally, a word on just the business strategy. In acquiring 
additional programming assets, Comcast is actually swimming 
against the tide. The company is wagering that it can make more 
productive use of GE's cable and broadcast networks. It does so 
knowing that its markets are in tumult.
    Video products are jumping from platform to platform, not 
just from cable to satellite, but from television to broadband, 
from linear channels to On Demand networks, from pay to 
premium, from TV screens to mobile devices. Some financial 
analysts appraise Comcast for its bold new enterprise. Many 
have condemned it. ``Didn't they learn anything from the failed 
AOL-Time Warner merger?'' is a fairly popular reaction.
    The simple fact is that no one fully understands where 
today's tide is headed. Cable operators do not know if they 
need fear Verizon or EchoStar, Google or Apple. Time Warner 
believes that splitting its cable operations from its program 
ownership is the best way to prepare for the coming storm. 
Comcast has come to a much different conclusion. Marks allow 
these rival strategies to be tested and winning strategies 
rewarded. I wish Comcast and General Electric shareholders well 
in their educated guesses.
    Thank you.
    [The prepared statement of Mr. Hazlett follows:]

                Prepared Statement of Thomas W. Hazlett








                               __________
    Mr. Conyers. Dr. Mark Cooper, director of research at the 
Consumer Federation of America. He has testified before 
numerous Committees, has written about this, is a fellow at 
Stanford Law School Center for Internet Society.
    We welcome you here.

TESTIMONY OF MARK COOPER, Ph.D., DIRECTOR OF RESEARCH, CONSUMER 
             FEDERATION OF AMERICA, WASHINGTON, DC

    Mr. Cooper. Thank you, Mr. Chairman.
    In today's written testimony and previous testimony before 
the House and the Senate, we have demonstrated that this merger 
is not in the public interest, because it eliminates the 
competitive rivalry and head-to-head competition between two of 
the most important participants in a distinct market, the 
multi-channel video programming market.
    Comcast and NBC compete head to head in local distribution 
of video content in a dozen of the Nation's largest and most 
important local markets. They compete head to head in the 
production of video content for multi-channel distribution, 
with Comcast doing sports and regional news, lined up against 
NBC Sports and regional news.
    They compete head to head in the distribution of video 
content online. Indeed, NBC is a major partner in Hulu, an 
Internet-based multi-channel video distribution platform.
    In addition to the elimination of this head to head 
competition, NBC and Comcast, by marrying their content and 
distribution, pose a threat while vertical leverage that is 
used to gain advantage in horizontal competition, favoring its 
own content with access to cable systems that reach one quarter 
of the market and denying competitive programming access to 
those cable systems places a very heavy thumb on the scale of 
competition in the video content market.
    Withholding must-have programming from competing 
distributors undermines competition for eyeballs in local 
distribution.
    The merged entity has an incentive to increase prices and 
increase the size of the bundle that NBC sells to cable 
operators, raising consumers' costs. And above all, the 
marriage of the Nation's largest broadband service provider 
with one of the Nation's premier video content producers also 
poses a direct threat to the Internet as a platform for 
disruptive competition in multi-channel video, a distinct 
market.
    The threat is real, and the danger is imminent. Comcast has 
already signaled its intention to extend the ugly cable model 
to the Internet by proposing a market division scheme with the 
second-largest cable operator, Time Warner. Comcast is seeking 
to prevent local sports teams from making their content 
available online. NBC has moved its Olympic coverage behind an 
Internet pay wall tied to cable subscription.
    Geography does not matter on the Internet. There are no 
franchises, no rights of way, or regulatory impediments, and 
few, if any, construction costs. The proposal that each cable 
operator restrict Internet access to cable customers is a 
blatantly anti-competitive market division scheme that must be 
stopped. In the cable lexicon, TV everywhere means competition 
nowhere.
    This merger is a competitive nightmare, and the promises 
made by Comcast that it will behave are useless for two 
reasons. They do not begin to address the competitive problems 
across the industry, and they are promises that cannot be 
trusted.
    Any serious discussion of conditions must address all of 
the major areas of competitive concern, in addition to the 
localism and diversity areas that Comcast has admitted are a 
problem, local markets, affiliate relations, cable program 
access, cable carriage, Internet distribution, and independent 
programming, and broadcasts in primetime.
    To ensure that conditions are enforceable, the Federal 
authorities with the oversight over these areas should complete 
industry-wide proceedings that address the underlying problems 
before this merger is approved. Many of these proceedings have 
been pending before the FCC for years. Once the industry-wide 
mechanisms are in place, the agencies should then consider 
whether additional conditions are necessary to meet the unique 
threat to competition and the public interest that is embodied 
in this merger.
    Comcast should also agree not to challenge the legality of 
conditions or render aid and comfort to those who do. The irony 
is that when they say they will obey the law, they are seeking 
to overturn those at the FCC and the courts.
    Federal authorities must do more than just preserve the 
current industry structure, which is riddled with anti-
competitive and anti-consumer institutions and practices. They 
should seize this moment to implement the long-overdue reform 
that will improve the plight of the American video consumer.
    If policymakers allow this merger to go forward without 
fundamental reform of the underlying industry structure, the 
prospects for a more competition-friendly, consumer-friendly, 
multi-channel video market will be dealt a severe setback.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Cooper follows:]

                   Prepared Statement of Mark Cooper



























                               __________

    Mr. Conyers. Larry Cohen, president of the Communication 
Workers of America, has been working in the collective 
bargaining movement most of his life, started out in 
Pennsylvania, rose through the ranks of the communication 
workers, and has been president since 2005.

TESTIMONY OF LARRY COHEN, PRESIDENT, COMMUNICATIONS WORKERS OF 
                    AMERICA, WASHINGTON, DC

    Mr. Cohen. Thank you, Mr. Chairman.
    CWA represents more than 700,000 members, most of whom are 
network and content providers, including members at Comcast and 
NBC Universal. So I believe we have a unique perspective on the 
impact of this transaction on workers and the industry.
    My remarks will focus in three areas: first, the impact on 
jobs; second, how the merger will aggravate, not encourage, 
current anti-competitive behavior in the television industry; 
and third, the problems that will result in the emerging 
Internet video marketplace.
    The bottom line? The public must be protected from the 
significant harms created by a combination of such 
unprecedented scale. A Comcast-NBC combination will, in fact, 
lead to the loss of good jobs. In any of these restructurings, 
there is never a warranty on employment, only promises.
    With official unemployment, as the Chairman said, at more 
than 10 percent nationally, we must evaluate all corporate 
transactions by assessing the impact on jobs. Comcast-NBC debt 
will increase by approximately $8 billion after this 
transaction. And to pay for the debt, the company has two 
choices: cut jobs or raise cable prices. Either way, consumers 
and workers lose.
    In addition to job loss, the combination will depress labor 
standards. Unfortunately, Comcast has a terrible track record 
of aggressive action to eliminate collective bargaining at the 
companies that it acquires. In 2002, Comcast acquired AT&T 
Broadband. At the time, CWA represented 5,000 cable employees 
there. After the transaction was announced, I met with Comcast 
executives. They told me they would respect the employees' 
rights to a union voice. And then let's see what a Comcast 
commitment means.
    Soon after they took control of AT&T Broadband, a senior 
vice president in Oregon announced, ``We will wage war to 
decertify the CWA,'' and that is what Comcast did. Comcast 
delayed bargaining for years, denied workers wage and benefit 
improvements provided to non-union employees, and supported 
decertification elections. Comcast refused to reach agreement 
on a first contract in 16 bargaining units that it acquired 
from AT&T.
    In Pittsburgh, Comcast workers were forced to go through 
four union decertification elections, all supported by 
management, in 5 years before they finally negotiated a union 
contract. CWA also represents Comcast employees in Oakland, 
California, and Detroit. In both locations, Comcast has shifted 
half the work to non-union, lower-wage, so-called self-employed 
contractors, reducing secure jobs and benefits in areas hard-
hit by unemployment. And where workers try to form a union, 
Comcast has fired and retaliated against union members.
    In contrast, collective bargaining at NBC Universal dates 
back to the 1930's. Our NABET affiliate represents broadcast 
technicians at NBC. Although we are currently in difficult 
negotiations with NBC, the bottom line is NBC workers have a 
collective voice through their union, a right that Comcast has 
consistently every time opposed.
    Let me now turn to the anti-competitive issues associated 
with this transaction. There is already too little competition 
in the video marketplace. As the chart on the screen shows, 
cable rates have grown at three times the rate of inflation. 
This merger would provide Comcast-NBC with added incentive and 
ability to engage in anti-competitive practices that would 
increase cable rates.
    Comcast after the merger would have the ability to bundle 
its less-desirable channels with must-have NBC programming. 
Forced bundling will raise other video providers' costs, which 
translates into higher rates for consumers.
    Today, some companies are trying to compete with incumbent 
cable operators. They are investing significant resources to 
build their networks. This merger would provide Comcast-NBC 
with the incentive and ability to raise the prices it charges 
new entrants for must-have NBC and sports programming, 
effectively blocking or limiting competition, cutting 
investment and jobs that accompany those efforts.
    In summary, the Comcast-NBC merger's potential to limit 
growth, investment and jobs is not in the public interest. 
Federal regulators cannot pass this merger without carefully 
considering the significant impact the merging companies will 
have on video competition, choice, and jobs.
    Thank you for the opportunity to testify today. I look 
forward to answering any questions. I ask that my written 
comments be entered into the record, along with this chart, and 
we welcome, finally, some dialogue.
    [The prepared statement of Mr. Cohen follows:]

                   Prepared Statement of Larry Cohen



























                               __________

    Mr. Conyers. Andrew Schwartzman, president of Media Access 
Project, since 1978, he has become a national expert on media 
issues, is a faculty member at Johns Hopkins University School 
of Arts and Science, and he has taught courses dealing with 
media and communications issues for a number of years.

 TESTIMONY OF ANDREW JAY SCHWARTZMAN, PRESIDENT AND CEO, MEDIA 
                 ACCESS PROJECT, WASHINGTON, DC

    Mr. Schwartzman. Thank you, Mr. Chairman.
    This is the most important media merger since Lucy met 
Desi. Comcast seeks to combine its huge cable and Internet 
footprint with NBC's content assets.
    Even though I have problems with Mr. Roberts' labor 
management practices and his corporate governance structure, I 
recognize that he is motivated by business considerations and 
not some sort of design to undermine American democracy. But 
the consequences of this deal, nonetheless, could have 
precisely that effect.
    Concentration and control of the mass media poses unique 
questions for policymakers and regulators. As Judge Green said 
when he considered the AT&T consent decree, the values 
underlying the First Amendment coincide with the policy of 
antitrust laws.
    Approval of this merger would increase Comcast's power to 
squeeze out independent programmers with diverse editorial 
perspectives. There are scores of cable networks which have 
been unable to obtain carriage on Comcast and other cable 
systems.
    I am here and they are not because some of these companies 
have told me that they are afraid of retaliation. And 
acquisition of NBC's stable of cable networks will greatly 
exacerbate the existing imbalance of power.
    If Comcast is permitted to purchase the NBC TV stations and 
its highly viewed cable networks, Comcast will be able to 
bundle unwanted programming when it seeks carriage deals with 
other MVPDs. The problem is even greater with respect to 
carriage on Comcast-owner cable systems. After the acquisition, 
Comcast would have many more cable networks to favor. This 
means higher prices for all Americans, not just Comcast 
customers.
    There ought to be a law against such abuse. And, in fact, 
there is. Section 616 of the Communications Act is supposed to 
prohibit cable companies from discriminating in favor of their 
own programming. While Comcast argues that existing law is 
sufficient to protect independent programmers, Comcast has 
suggested, but not quite promised, that it will not renew its 
efforts to challenge the constitutionality of Section 616 in 
the future.
    However, this does not change a more fundamental fact, 
which is that the existing statute does not work. Program 
carriage litigation is prohibitively expensive, and the FCC has 
adopted almost insuperable legal hurdles for complainants.
    Combining NBC Universal content with Comcast cable and 
Internet distribution systems will also give the merged company 
vastly increased power over content distribution markets. 
Depending on the circumstance, Comcast could choose to withhold 
its programming or force it on competitors at inflated prices. 
This, in turn, will increase cable bills and deprive customers 
of access to programming from diverse sources. The FCC has 
program access rules which are supposed to stop such practices.
    Although Mr. Roberts has said that Comcast may agree to be 
bound by program access rules voluntarily, so far he has 
refused to withdraw Comcast's legal challenge to continuing the 
rules in effect. That aside, there are many reasons why even 
the existing rules are insufficient.
    First, they expire in 2 years, and there is no assurance 
they will be extended. In any event, the program access regime 
does not preclude bundling. Although the law prohibits 
discrimination against competitors, in this instance, it simply 
means that as long as Comcast overcharges itself, it can 
overcharge everyone else.
    Re-transmission consent rules are even less reliable as a 
tool to protect video competitors. Among other things, the 
statutory mandate for good-faith negotiation does not prohibit 
price or packaging discrimination. It simply requires a 
commercially feasible offer.
    I note that Mr. Roberts has indicated that Comcast may 
increase retransmission consent payments for Comcast 
affiliates. Now, this may or may not be a good thing for the 
future of broadcast TV, but no one should doubt that the impact 
of this would be to raise cable rates for everyone.
    Representative Lungren, the good news is that Internet 
technology offers the prospect of creating vibrant and highly 
competitive distribution channels for video programming. 
Members of the public can or soon will be able to receive high-
definition video on the Internet, but Comcast has already taken 
steps to kill off such competition, and acquisition of NBC's 
content will greatly enhance that campaign.
    The prospect of consumers canceling their cable 
subscriptions and relying on the Internet poses an existential 
threat to the cable industry. Comcast's answer is Xfinity, 
which allows Comcast customers to view video over the Internet 
without extra charge. The catch, which is a very big catch, 
indeed, is that you must keep your cable TV subscription.
    Xfinity permits Comcast to cut off the flow of programming 
to potential new competitors while preserving the cable TV 
revenue stream indefinitely. Stripped of slick marketing, 
Xfinity consists of agreements among competitors to divide 
markets, raise prices, exclude new competitors, and tie 
products.
    Comcast's ownership interest in Hulu is especially 
important here. Comcast can cripple Hulu by withdrawing NBC 
content or it may choose to make the NBC content exclusive to 
Hulu and withhold it from new Internet-delivered video 
competitors. Either way, it is bad for the public.
    There is more, but no more time. I urge you to oppose 
approval of this merger.
    [The prepared statement of Mr. Schwartzman follows:]

              Prepared Statement of Andrew Jay Schwartzman

















                               __________

    Mr. Conyers. Marc Morial was a state senator in Louisiana. 
He then became mayor of the city of New Orleans. He has taught 
constitutional law as a professor at Xavier University. He is 
now the president and CEO of the National Urban League. And we 
welcome him to this hearing.

TESTIMONY OF MARC H. MORIAL, PRESIDENT AND CEO, NATIONAL URBAN 
                      LEAGUE, NEW YORK, NY

    Mr. Morial. Thank you. Thank you very much, Chairman 
Conyers and Members of the Committee. It is indeed an honor, 
Chairman Conyers, to be before your Committee. Thank you for 
your leadership.
    I represent the National Urban League. We are this year 
celebrating 100 years of continuous existence. We serve 2 
million people a year through 100 affiliate chapters from coast 
to coast. That includes operations in 36 states and the 
District of Columbia, from Anchorage, Alaska, all the way to 
Miami, Florida, and I am proud to be here today, and thank you 
very much.
    A couple of points that I would like to make at the outset. 
First, GE is selling its interest in NBC Universal so that it 
can devote its investments and energies to its core business, 
period. That being the case, I would like to see NBC Universal 
in a joint venture with, one, an American company, two, a 
company with a proven track record in an understanding of the 
television business, and, three, a company that has 
demonstrated a track record on diversity issues and in working 
with diversity organizations, like the one I lead.
    That being the case, the National Urban League has not 
taken a formal position on this transaction. And we are 
withholding any formal position pending discussions with senior 
management relating to diversity programming, employment 
issues, and other very important things related to our mission.
    But I do believe that Comcast should be entitled to great 
respect in this process based on its past actions with respect 
to the diversity community. They have a demonstrated commitment 
to measures relating to diversity. That includes in the areas 
of employment and programming, and I would cite its proactive 
investment in TV One.
    Also, Comcast has made commitments about new and 
independent programming opportunities for its new joint 
venture. We will urge that this new joint venture include new 
opportunities in the area of diversity programming.
    For the record, Comcast has been an important corporate 
partner to the Urban League. They have forged local 
partnerships with many of our chapters. They work with us in 
Philadelphia on a job-training program for cable installers. 
They have a national partnership with us designed to raise the 
awareness of us, including supporting our State of Black 
America report, which is our annual report to the President, 
this Congress, and the people of this Nation.
    NBC Universal has also made important strides in its 
commitment to diversity and inclusion. We have worked with the 
senior leaders to increase the voices of color in commentary 
roles on NBC, MSNBC, CNBC--now, in all of these areas, a 
foundation has been laid, but there is much, much more in the 
area of diversity that needs to be done.
    So we look forward to our discussions regarding how this 
new joint venture will continue and strengthen its commitment 
to diversity. And when we talk about diversity today, Mr. 
Chairman, we are talking about diversity in the areas of 
employment, including the most senior levels of the new joint 
venture. Diversity in procurement, the opportunity for 
businesses of color to do business with the new venture. 
Diversity in governance, which are those boards, those 
management committees that oversee the operation of the joint 
venture. Diversity in philanthropy, which involves the 
community engagement that the joint venture would have with all 
communities that represent the great tapestry of the United 
States of America. And diversity in programming, because 
diversity in programming is enhanced not simply by access, but 
also access to capital, and a commitment to finance the kind of 
programming that we need to give communities that have been 
left out an opportunity for their great contributions to this 
Nation to be seen, to be heard, and to be artistically 
expressed.
    We also believe that in the event that any local broadcast 
licenses are spun off as a result of this merger--this 
transaction, I should say, that minority businesses should have 
a fair and equal opportunity to acquire these assets.
    We believe--and it is our goal in the discussions that we 
will have with NBC Universal and Comcast--to set a standard for 
this new venture to be a first-class company when it comes to 
diversity. That is our aim. That is our goal. That is what our 
conversations will be all about. And we will be engaging in 
discussions with their senior leadership on these areas of 
concern.
    So I want to thank the Committee, certainly, for its 
consideration. I appreciate the opportunity to testify today. 
Thank you so much.
    [The prepared statement of Mr. Morial follows:]

                  Prepared Statement of Marc H. Morial





                               __________

    Mr. Conyers. Howard Berman, senior Member of Judiciary 
Committee, Chairman of Foreign Affairs?
    Mr. Berman. Thank you very much, Mr. Chairman, and I 
apologize to you and to the witnesses because we are chairing a 
hearing now with the Secretary of State, and I did not get a 
chance to hear your testimony, but I have copies of it, and I 
intend to read it, other than Mr. Morial, who I did get to hear 
now.
    This proposed--this possible joint venture has two appeals 
to me. One, a more general proposition that things which get 
the distribution side of content to understand the needs of 
content providers to protect their creativity would be a 
welcomed outcome. So as a general proposition, I am--that 
intrigues me, and I think it is an important consideration.
    Secondly, Universal Studios, a key part of this process, is 
located in my district. It is on the board with Adam's 
district, but it is--at least for another year-and-a-half--
still in my district. And it is a major source of--it is a 
major employer.
    And not only Universal Studios, there are all kinds of 
other companies whose existence and well-being is related to 
the strength of Universal Studios as a--in other words, for 
this, this is a jobs issue for me in a very real sense.
    So my first question is, there are labor agreements and 
jobs at Universal Studios. I am curious if Mr. Roberts or Mr. 
Zucker could address that issue.
    I would also--let me ask my question now, as well. 
Commitment number 12 in this proposal, which promises that once 
the NBC Universal completes its company-wide digital migration, 
it will add two independently owned and operated channels to 
its digital line-up each year for the next 3 years on customary 
terms and conditions.
    I have seen what has happened since the repeal of the 
financial interest syndication rules. While I want a thriving 
Universal Studios, I want it based on the investment and the 
creativity of their work. I don't want situations which further 
add limitations to the ability of independent productions to 
have access to distributors.
    And I am wondering, with the addition of these new 
channels, how is this going to affect the opportunity 
independent producers may not have had? How do they--how do 
independent film and television fit into this joint venture 
beyond commitment number 12?
    Mr. Roberts. Okay, thank you. Let me start and attempt to 
address both those issues and then pass to Mr. Zucker, if I 
may.
    It goes to the main motive of, why do we want to do this 
transaction as Comcast? It is to build and to reinvest into 
Universal, NBC, and the great entertainment properties they 
have, in some cases what they have been in the past and what we 
hope they can be in the future.
    And I think General Electric will take the proceeds, as we 
mentioned, and more likely than not, invest in their core 
business, which is, as they have said publicly, infrastructure 
and things all over the world.
    For Comcast, this is a once-in-a-lifetime opportunity, I 
believe, to help transform our company. So the motive is not to 
come in and have significant--or any-- job reductions, but 
rather to really try to figure out where the consumer's going; 
and how to restore some of the greatness to NBC and Universal, 
to continue to invest in the cable channels and the creativity 
that has been there and is there today with networks like USA, 
CNBC, Syfy, and Bravo.
    And I think our channels are not of the same stature. The 
Entertainment and Style networks are terrific channels not 
ranked currently, as of 2009, in the top 30. And a number of 
NBC-Universal's are ranked. So we really think this is an 
opportunity to become one of the better content producers all 
over the world and to really take from your district the great 
creativity and extend it to new platforms and new innovation.
    So our commitment absolutely is to invest in local 
television, broadcast television, cable television, filmed 
entertainment, the theme parks. None of those businesses is 
Comcast really a major provider today. There is not the overlap 
that a number of--in the statements that some mergers would 
have, if GE was selling to another one of the major media 
companies, they would have a movie studio, they would have a 
broadcast network, they might have a theme park or another 
entertainment channel like USA or a news channel. Comcast does 
not have any of those types of assets on a national basis.
    So I would feel very comfortable saying that the goal here 
and the motivations are to build and to innovate.
    Jeff?
    Mr. Zucker. Congressman, I would add that the last couple 
of years have been difficult, especially on the broadcasting 
side, for everybody. I look at what is going on at some of our 
peers, unfortunately, just this week announcing significant job 
reductions in their news divisions. And we take no glee in any 
of that.
    The fact is, with this commitment to broadcasting, with 
this commitment to investment, I actually feel better about the 
future of NBC and NBC Universal than I have in a long time and 
am gratified by the fact that this is not about synergies and 
anything of that sort. And so I--I take comfort in that and 
hope you see that, as well.
    Broadcasting has been under tremendous duress in recent 
years, as other forms of media, like newspapers and radio have, 
and our peers are going through it right now. This commitment 
to--this commitment to broadcasting and the jobs that come with 
that is something that gives me good comfort.
    Mr. Berman. Talk for a moment about the access of 
independent productions to the programming networks.
    Mr. Roberts. So there are two sides, I believe, of that 
question. First is, as a cable company, six out of every seven 
channels that Comcast carries in our cable systems after the 
merger or the joint venture will be non-owned by Comcast. We 
have made a commitment that we would add two independent 
channels each year for the next 3 years starting next year.
    And as to how we relate to the independent production 
community, today we don't make movies, so we have no preference 
between a movie we would make or a movie that is independently 
made that we might want to distribute. We do carry the Sundance 
Channel and the Independent Film Channel.
    The philosophy of Comcast, just since my dad's founding of 
the company, to go back to 1963 in Tupelo, Mississippi, Comcast 
couldn't get the television signal from Memphis, which was CBS. 
And the philosophy has been to give consumers more choice. 
Choice sells.
    And ever since we rebuilt our systems from 10 channels to 
30 channels, the question was, how are you going to fill the 30 
channels? When you go to 100 channels? To 500 channels. Now we 
have in some markets 15,000 choices On Demand any time you want 
them, and last year, we laid out a vision for where I would 
like to see the company go. We call it Project Infinity.
    Any piece of content that a consumer wants to get, they 
should be able to access and leave it to the content company to 
figure out what the business model is, whether that is 
advertising-supported, subscription, or Pay-Per-View, and what 
device it is on.
    And so our technological vision is to continue to give more 
and more choices, which absolutely will include as many--
whoever and wherever that content wants to be made by.
    Jeff?
    Mr. Zucker. I would add, on the independent programming 
side, on--as far as our cable networks go already, I think we 
have demonstrated our willingness to show that third parties 
own 67 percent of the programming on the USA cable network in 
primetime and 83 percent of the programming on the Syfy 
primetime line-up.
    With regard to NBC and the NBC television network, the fact 
is, we need the best programming wherever it comes from, 
certainly today more than ever, and the fact is, we have 
dramatically increased our commitment to try to find new 
programs from non-NBC affiliated sources. This year, we are 
developing somewhere close to 20 new programs for NBC, and we 
have doubled the number this year that have come from non-NBC-
related sources.
    So the fact is, with regard to NBC, I don't think this has 
any impact on our willingness to find programs from--the best 
programs from wherever they come from.
    Mr. Berman. Thank you, Mr. Chairman.
    Mr. Conyers. Chairman Prewitt, your comments?
    Ms. Prewitt. The fact that this will have no impact on the 
current business dealings with the independents actually fills 
me with fear. With all due respect, the statistics we have just 
heard about unaffiliated programming does not distinguish 
between programming provided by independents and provided by 
other conglomerates.
    And I would draw your attention and happy to provide you 
with a copy of an L.A. Times article from May citing the 
decline in truly independent series that were picked up this 
year. I believe the NBC statistics were of five new series. 
Four were from NBC, and one was from Sony. That is not, from 
our perspective, independent programming, although Sony is in a 
funny posture here, since they don't own a network.
    You know, our experience in general is that the broadcast 
networks are now wholly unavailable to truly independent 
programming, unless you are producing reality series, some of 
which will make their way through.
    These high statistics, even stripped of the other 
conglomerates on cable, are because cable has become where you 
push the independents. And that has had two results. In 
addition to limiting access overall, it also shifts what people 
produce.
    And in 2002 and 2003, when our member companies were told 
by every major children's outlet, both on broadcast and cable, 
that they would no longer buy independent, they ceased to 
produce that programming. Common sense says you don't invest if 
there is no marketplace.
    And so what you do is programming not only being limited in 
terms of access, it shifts in terms of subject matter, it 
shifts away from the type of programming, in many cases, that 
we would all like to encourage.
    Two new channels on a cable system out of 500 sounds to me 
like slim pickings. And it is particularly slim pickings in a 
marketplace where, as we have heard, it is very difficult for 
anyone to support those channels. It is very difficult to 
acquire the acquisition budget to bring onboard quality 
product.
    Ultimately, what happens with many of those channels is 
they just recycle, and what we are now seeing across the board 
is consistent recycling from the five major conglomerates. And 
I think what the true independents are looking for is a chance 
to compete in the same arena as the conglomerate programming, 
not to be told over and over again--and this has happened 
consistently since 2000--that channel after channel will no 
longer look at programming that comes from outside the system.
    And this merger can only aggravate that situation. There is 
a history here which sets the stage and a merger which then 
threatens to carry it to the next level. And I would certainly 
call people's attention specifically to the plans for how TV 
Everywhere will be built, which are--you know, at least in the 
FCC filing, are very clear that that will be NBC Universal 
content, that dealing with third parties is very pesky and 
creates a lot of overhead.
    And what you can see over and over again is the same 
economic pressures driving toward a preference for content, 
which you control across multiple platforms, and that does not 
create opportunity. And I think this Committee should speak out 
very strongly both to the regulatory agencies and to the 
merging parties that, out of all these commitments, 
interestingly enough, not one addresses this problem.
    Thank you.
    Mr. Conyers. Dr. Cooper?
    Mr. Cooper. Mr. Berman, yes, let me address the historical 
point. And you have raised it. Jean has referred to it.
    You simply cannot replace the dynamic of an independent 
sector to produce diverse programming--we have heard a great 
deal about it--with a commitment to a couple channels buried 
someplace in 500. And Jean mentioned ``The Cosby Show,'' but 
that is only the tip of the iceberg. ``All in the Family,'' 
``Chico and the Man,'' ``Sanford and Son,'' ``Cagney and 
Lacey,'' ``Roseanne,'' ``The Golden Girls,'' all of those were 
independent shows during a period when the networks were 
required to buy independent shows.
    It was those shows that ended the ``Ozzie and Harriet'' 
view of America. It showed if it is black and brown, old and 
young, rich and poor. That is the kind of dynamic diversity you 
get when you have independent programmers who can gain access.
    And it was clearly--and I did a study of this several years 
ago. It was the loss of that diversity, the decline in quality 
that came with vertical integration, that undermined broadcast 
TV. The decline in quality came first.
    And so the notion that a couple of commitments to do some 
programming, a little bit, a teeny bit, will solve the problem 
of the production that meets the diverse needs of America is 
simply contrary to historical fact. Vertical integration 
undermines diversity and quality.
    Mr. Berman. But that was a totally foreseeable consequence 
of repeal of the regulations in place.
    Mr. Cooper. If you look back at the history, there were 
promises made to Congress that, oh, we won't eliminate the 
independents. They were gone instantaneously, because you make 
more money buying internally, rerunning lower quality shows, 
because you have already incurred the production cost, than 
buying higher quality shows.
    But what happens when you rerun that stuff and repurpose it 
is you lose your audience. You miss the notion that you have to 
produce high-quality content and buy it from the best 
independent you can. For 15 years, that hasn't worked.
    Now, you hear some suggestions that the industry is 
discovering the error of its ways. It is convenient at the 
moment of a massive vertical merger that they suddenly discover 
that the integration model is wrong. It failed, and you should 
not allow it to rear its ugly head again.
    Mr. Conyers. Andrew Schwartzman?
    Mr. Schwartzman. I don't have a lot to add to that, Mr. 
Chairman. I would just point out that the question before the 
Committee is the acquisition of NBC Universal by Comcast. And 
whatever kinds of commitments that Mr. Zucker is making with 
respect to increasing his use of independent programming will 
be unchanged by that acquisition.
    And, second, as Dr. Cooper said, the commitment to add a 
few independent channels is of no significant consequence. 
First of all, it is very specifically limited to digital 
systems, and not all Comcast systems are yet digital. But, 
second, two channels in a year without any commitments with 
respect to tiering make that a very questionable--simply of 
questionable utility.
    Mr. Conyers. Larry Cohen?
    Mr. Cohen. I would just comment on the jobs question two 
ways. We look at jobs internally, and I actually talk quite a 
bit about that within the combined company. We often get--
always get in these mergers and restructurings commitments that 
there is no warranty and then jobs are cut. How do you pay for 
the $8 billion in debt? They cut jobs, and they continue to 
raise rates. We already have rates raising three times the rate 
of inflation.
    But externally is even more important. As a participant in 
a jobs summit, I was cheered to see management, labor, 
academics, governments saying we are going to put a jobs filter 
on every key governmental decision, and there is no question 
that this merger goes through. There is a disadvantage to the 
other types of companies, and it will shrink investment, and 
that will cut jobs.
    Because of what they call bulk pricing, any new entrants 
and communities have to pay much more for content than they do. 
And that bulk pricing shrinks up investment, because the pipe 
companies--it is incredibly expensive to bring fiber to the 
home, although it is happening in all the rest of the world, 
and so what happens is--TV product to sell at a decent price, 
they don't invest, it is already shrinking.
    It is absolutely not true that we are going to have robust 
competition. It is shrinking now. They are cutting down on that 
investment in this country. And so it has a disastrous effect 
on jobs, particularly externally. And internally, to be honest, 
we are going to say again: Where's the warranty? Where's the 
warranty against using freelancers instead of employees and 
contractors instead of employees?
    And, you know, there isn't any warranty. We get one story 
before the merger and a different one after.
    Mr. Conyers. Ranking Member Larry Smith?
    Mr. Smith. Thank you, Mr. Chairman.
    Mr. Conyers. Lamar Smith.
    Mr. Smith. First of all, Mr. Roberts and Mr. Zucker, if I 
were you, I would take Mr. Schwartzman's concession that at 
least you are not trying to undermine America's democracy and 
run with it. That may be the most you are going to get.
    Mr. Roberts, let me direct my first question to you. NBC 
Universal, of course, is primarily a programming and content 
company. Your Comcast is primarily cable. Would you speak a 
little further on where you see the overlap of the two 
companies and how this proposed merger would impact that 
overlap?
    Mr. Roberts. Thank you. In Ms. Prewitt's testimony, she 
mentioned that there are five companies that have 24 of the top 
29--I am not sure if those stats are right or not--of the 
channels, 80 percent of the entertainment content. I don't 
believe Comcast owns a broadcast network. I don't believe 
Comcast owns any of those assets.
    So the conversation that we were just listening to about 
independent voice or whatever, the fact is, that is 
broadcasters talking with the folks who make the programming 
for the NBC network, which Mr. Zucker is obviously expert on. 
Comcast does not have a relationship with some of her members, 
like Lions Gate or the Weinstein company. We have had other 
partnerships and distributed their content outside of that on 
our cable system, on our On Demand platform.
    So I believe what this merger is about is a big risk on our 
part. Broadcast television has changed tremendously in the last 
20 years. And so has the technology by which consumers consume 
entertainment, information, and news, not just television.
    And so are we. As we heard, other companies have chosen to 
not want to be in one company, because there aren't significant 
obvious synergies. We are making a bet that we can accelerate 
this transformation for the consumer, so we touch together 
places like On Demand.
    When I talk to my customers, their number-one complaint 
with our On Demand service, which has been wildly popular--13 
billion orders of On Demand shows just in Comcast in the last 
few years, more than all of iTunes in the United States put 
together, half-an-hour average--their main complaint is, why 
can't I get more movie choices on that On Demand?
    Well, Universal has 4,000 movies in its library. And they 
have 3,000 shows from television in their library. Now, I can't 
promise sitting here today--how to bring that together to get 
it to On Demand faster, but we are certainly going to try real 
hard.
    Mr. Smith. Thank you, Mr. Roberts. Mr. Roberts, you 
mentioned that television has been changing dramatically.
    And, Mr. Zucker, I wanted to ask you what you thought about 
the future of television. Do you see it being the more 
traditional television? Do you see television being more 
online? And where do you see the proposed new entity fitting 
into that vision of the future of television?
    Mr. Zucker. Well, as I mentioned before, I think there is 
going to continue to be more change in our space in the next 5 
years than we have had in the last 50. I think that the digital 
revolution, the technological revolution that Mr. Roberts was 
just talking about is going to continue to change the way we 
all consume television, the way we all consume information, the 
way we learn about things, the way we watch everything that we 
have been used to.
    So I think that, over the next 5 years, we will all 
continue to watch TV. We will gather around a television and, 
you know, learn news, watch sporting events, watch 
entertainment programs, but we will also have the ability to do 
that in many other ways.
    So I think television will still be there, but I think 
that--I think the innovation that we have all come to see will 
also allow us to enjoy all of those things in other ways.
    I think that what is great about this merger is that there 
will be investment from Comcast that will produce even more 
content. And at the end of the day, that television that we are 
talking about or however we consume it, it all comes back to 
great content and great news-gathering and great sporting 
events. And without investment, none of that is possible.
    I also would add that this commitment to broadcasting and 
to the NBC television network and to Telemundo on the Hispanic 
side cannot be underappreciated. We don't live in a world that 
was 15 years ago, when three networks had 90 percent of all 
viewing. We live in a very different world where there were 
very different rules back then.
    The choices and the explosion of outlets is so different. 
And so the commitment to actually keep NBC and Telemundo strong 
is incredibly important today.
    Mr. Smith. Okay. Thank you, Mr. Zucker.
    Mr. Roberts, let me address my last question to you again, 
and that is that, as you know better than I, the protection of 
intellectual property is essential not only to a lot of 
American companies, but, quite frankly, to a prosperous economy 
in our country, as well.
    We have a real problem today with the theft of copyrighted 
programming. And we oftentimes look at ISPs and others to 
educate their consumers and to try to crack down on that kind 
of theft and that kind of piracy. What has Comcast done and 
what do you propose to do to try to reduce that type of 
intellectual property threat?
    Mr. Roberts. I think this--the entire ecosystem--that is 
the creative community in this country--depends on that 
question. And while we have seen an explosion in the 
connectivity side, which has principally been our business--
originally television, now broadband--having license-secured, 
not pirated content is the essence of that ecosystem for both 
sides of the business.
    By now making--on our way toward a $30 billion investment 
in content, which is what has been reported the potential value 
of this transaction is--that kind of order of magnitude. It is 
only 51 percent in the first stage, but over time, we intend to 
try to buy GE out 100 percent.
    We have redoubled our commitment to figuring out how to 
work between the two parts, the delivery, and what consumers 
want with their broadband connections. So we will be--through 
NBC Universal--involved with MPAA, and we will be involved with 
all the other organizations, not just the NCTA.
    So I sit here today--I don't have the answer, but I think 
we have a huge motivation and one of the benefits, as was 
stated, in this transaction is that we have that motivation by 
Mr. Berman to help figure this out. And I pledge to you to 
personally engage and try to not just educate our consumers, 
but use whatever technology gets developed to help make sure it 
remains not pirated.
    Mr. Smith. I appreciate that commitment. Now, Mr. Chairman, 
I know you like to treat both sides equally, so I would like to 
yield my remaining 10 minutes to--2 minutes, if I may, to Mr. 
Harper, the gentleman from Mississippi, who I know has to leave 
for another commitment and is already late in doing so, but I 
would like to give him at least a couple of minutes if we 
could.
    Mr. Harper. Thank you, Mr. Chairman and Mr. Smith.
    Mr. Roberts, I would like to ask you a couple of questions, 
if I could. I have heard some concerns, worries from an 
organization representing some local, you know, small cable 
companies that are in my district in Mississippi. And, of 
course, they are concerned that this proposed merger will give 
Comcast significantly more market power in negotiations, 
particularly with regard to the regional sports networks.
    And I would like to know what your thoughts are on how that 
merger will affect those small cable companies that have those 
concerns.
    Mr. Roberts. I think there are--on a number of issues that 
we have heard previously discussed and on that specific issue--
I don't believe this transaction affects that issue. We are not 
doing this transaction to go and somehow change the dynamic 
between a regional sports network or anyone else--any of the 
other properties that NBC may have and small, rural operators, 
whether they are broadcasters or cablers.
    There are teams that we carry on our regional sports 
channels that don't get affected by--I don't believe by any--
NBC is not in the regional sports business. So if there is a 
property in the South, Comcast Sports South, that property will 
remain the same as it is before the deal.
    Mr. Harper. Okay. And if we look at the role--and I know 
Comcast is taking it serious--on protecting parental concerns 
on content as it might affect children, this new entity that is 
proposed, will there be any changes there? Or how should we 
look for that to be dealt with?
    Mr. Roberts. Well, we have made a number of commitments. 
One is for children--more children's programming, both on 
television and On Demand. An issue that I feel good about where 
cable has taken the technology and where we will take it in the 
future is to make it easier for parental controls in your 
living room to work and to have more sophistication in those 
parental controls so parents are able to filter those shows, 
those channels, and with more granularity and more choices of 
ways to do that.
    And, you know, a huge opportunity and one that we take very 
responsibly, as well as the news area, is independence and 
trying to take the wonderful brand credibility that NBC has, 
both with children and with news, and extend that throughout 
the company.
    Mr. Harper. Thank you, Mr. Roberts.
    And with that, Mr. Chairman, I yield back my time.
    Mr. Smith. I will yield back. Thanks, Mr. Chairman.
    Mr. Conyers. Jerry Nadler?
    Mr. Nadler. Thank you, Mr. Chairman.
    Dr. Cooper, first, I must correct the record. You quote the 
eminent Professor Epstein, who is, of course, one of the great 
professors in the Chicago School of Economics, but you say he 
is at the University of Chicago. He is no longer there. He is 
now at NYU in my district, so I just wanted to mention that. 
This is a great----
    Mr. Cooper. And he hasn't changed his beliefs, as far as I 
know.
    Mr. Nadler. He has not changed his beliefs. And, in fact, 
my son is one of his research assistants now. But I am not of 
the Chicago School of Economics, nor is my son.
    In any event, let me ask you the following. You say that 
Professor Epstein ignores the mountains of evidence that there 
are numerous clearly defined markets in which Comcast and NBC 
compete head to head. Now, we have been told that this is 
essentially a vertical integration and the problem is whatever 
problems there may be associated with that. This is not 
essentially a horizontal combination. And you are saying that 
this is completely not true.
    Could you elaborate on that for a moment? What is the 
extent, if at all--what is the extent of horizontal competition 
that would be eliminated by this merger?
    Mr. Cooper. Well, as I identify in my testimony, there are 
a dozen local markets in which they compete. Comcast is a 
distributor, and NBC owns a TV station. They see themselves as 
competitors. NBC has filed testimony at the FCC which outlined 
the head-to-head competition in local advertising, for 
instance. Absolutely.
    They gave me two examples where if you do the math of the 
concentration ratios that the antitrust people do, it is a 
horrible merger. There are a dozen markets where they compete 
head to head. They clearly compete for sports eyeballs. Comcast 
is the regional sports giant; NBC is an icon of sports 
programming. They compete in news. Comcast is a regional news 
giant; NBC is an icon of news. That is in the content space.
    They now compete vigorously on the Internet. They both have 
portals. NBC invested in a multi-channel video programming 
alternative. So they clearly compete there. That is undeniable.
    The vertical element that affects the horizontal market is 
also important, because now you give NBC programming guaranteed 
access to a quarter of the eyeballs in the country. That is the 
distribution married to content. NBC no longer has to negotiate 
for carriage across 100 percent of the cable eyeballs. They 
only have to negotiate for 25 percent. They are in a much 
stronger bargaining position.
    Mr. Nadler. Twenty-five or for seventy-five?
    Mr. Cooper. Seventy-five, that is right. They have 
guaranteed 25 percent, so they only have to negotiate for 75 
percent. That improves their bargaining position.
    They have a bigger bundle. Now NBC content is married to 
Comcast content, so the bundle gets bigger. So all those--that 
is vertical leverage that can be used to beat the other guys.
    Mr. Nadler. Thank you. Does Mr. Zucker or Mr. Roberts want 
to comment on this?
    Mr. Zucker. I would just point out a few things, which is 
that, even if there is competition in certain local markets 
between the NBC stations and the Comcast cable affiliates, 
there are still seven non-NBCU-related broadcast stations in 
each one of those markets. The fact is that----
    Mr. Nadler. Seven each or seven combined?
    Mr. Zucker. Seven, in each of those markets. So the 
competitive nature that exists in each one of those markets 
remains incredibly vibrant and healthy. And given--you know, 
given the competitive nature of each one of those stations, it 
will continue to be very strong.
    Mr. Nadler. Dr. Cooper?
    Mr. Cooper. If you do the math on the local advertising 
revenues that NBC put in the record at the FCC, the merger 
violates the Department of Justice and Federal Trade Commission 
guidelines by a mile.
    Mr. Nadler. On that horizontal competition?
    Mr. Cooper. On that horizontal competition. The standard is 
that, if the post-merger market is above 1,800--again, these 
are numbers----
    Mr. Nadler. Eighteen hundred what?
    Mr. Cooper. Eighteen hundred in the HHI. This is an index 
that they use. If the merger raises by 50 points in a highly 
concentrated market, it is supposed to be considered a severe 
threat to competition. This merger raises it by 800 points, 16 
times the threshold.
    Mr. Nadler. Thank you.
    Ms. Prewitt--did I get that right? Yes. Ms. Prewitt, you 
testified that industry trends have promoted consolidation in 
uniformity and that it is going to become impossible for 
independents to get their programming placed. And you also 
testified that, in fact, many of the major distributors have 
already said they don't want to use independent programming at 
all.
    Can you tell us how this merger specifically will worsen 
that situation?
    Ms. Prewitt. Well, we are looking at two aspects, one of 
which are the traditional platforms and then the new platforms 
that will either be developed or at a nascent level today. With 
respect to the traditional platforms, quite frankly, there 
simply is no commitment to even maintain the marginal level of 
independent acquisitions that exist today.
    Most independent product is on this handful of basic cable 
channels. We see nothing in the 16 or 17 commitments that say 
that that will remain untampered once the acquisition goes 
forward. And there is new revenue to fuel more production.
    Mr. Nadler. But you are saying that it doesn't if that does 
not change, since they have already ruled it out?
    Ms. Prewitt. We don't know if it changes or not.
    Mr. Nadler. No, no, but if it doesn't change, it doesn't 
matter, because they have already taken you, is what you are 
saying.
    Ms. Prewitt. Yes, that----
    Mr. Nadler. So what you are really saying is that this 
merger might make it worse at the margins, but the major damage 
has already been done?
    Ms. Prewitt. Exactly. There are some limited outlets today. 
We would like those preserved. There is no promise here to 
preserve them.
    But the other issue, I think, is the new and emerging 
outlets. Video On Demand is a vibrant marketplace or developing 
into a vibrant marketplace that begins to take up some of the 
slack of the former DVD revenue stream. When you can't get on 
television, you go to DVD.
    You would like to be able to go to video On Demand. Again, 
no real commitments here to open the doors to that system to a 
wide range of independent programming. TV Everywhere, Hulu, 
things of that nature, as our members go to those platforms, 
what they are increasingly told is, until the revenue model is 
at least clear, we are not interested in taking programming 
that hasn't been previously seen on nationwide TV, that has not 
been supported by a worldwide marketing campaign. We can't 
support anything with marketing. We really only want 
programming that comes with its own audience.
    And so that, combined with the statements at least in the 
FCC filing that TV Everywhere--one of the big advantages now is 
going to be that you can use only Universal content.
    Mr. Nadler. One of the advantages now or one of the 
advantages to be of TV Everywhere?
    Ms. Prewitt. With the merger. One of the advantages of the 
merger is touted as not having to go outside and fight with 
third parties to get content commitments because we can build--
they can build TV Everywhere up to a substantial level, really 
relying only on the NBC Universal vault, and that becomes a red 
flag as to where does that go and how does this impact all of 
the new platforms?
    Mr. Nadler. So, in other words--and I am going to ask Mr. 
Roberts to comment on all this in a moment--so in other words, 
just to distill or summarize what you are saying, is that 
already the major distribution networks simply won't look at 
independent products, and there are some marginal that will. 
This merger won't make that worse in that respect, because it 
is already done, but it is not going to improve it in any way.
    And, second, the ability to go to DVD and other new things 
will be worsened by this merger, because one of the points of 
the merger is that NBC will be--not NBC--Comcast will be able 
to use the existing internal archives and, therefore, won't 
need independent programming. Is that what you are saying?
    Ms. Prewitt. I am saying that we hope the existing 
situation won't get worse, have no promise it won't be.
    Mr. Nadler. Right.
    Ms. Prewitt. And----
    Mr. Nadler. But I have got the second half right?
    Ms. Prewitt [continuing]. The new platforms will be. Yes.
    Mr. Nadler. Okay. Mr. Roberts?
    Mr. Roberts. Okay, thank you. As I think you have been 
pointing out, some of this doesn't relate to the merger. Some 
are industry issues. And I think to the extent that folks think 
the industry doesn't have lots of diversity of voices, you 
know, then it is an industry conversation not related to the 
merger.
    Mr. Nadler. Well, let me ask you this. I mean, do you think 
it is accurate what we have heard this morning, that the major 
distribution companies such as Comcast and others essentially 
have shut their doors to independents?
    Mr. Roberts. No, definitely not the case. In fact, in one 
of the examples of On Demand, you know, that is where so many 
people have been watching movies. We have had an easier time 
with some of the independents getting the movies, because they 
are smaller movies, they don't have as many box office issues, 
and issues with DVD sales, and so they are quicker to put it On 
Demand and have a direct relationship with the consumer. So 
some of the----
    Mr. Nadler. Is that true just of movies or of documentaries 
and----
    Mr. Roberts. Documentary channels. Quite to the contrary of 
that least for Comcast cable. We are looking, and part of 
Project Infinity is to have as many relationships as we can. 
When we first launched On Demand, we weren't able to get 
broadcast television or really near-first-run movies. I think 
the Wall Street Journal wrote a piece about why On Demand isn't 
worth all the billions of dollars that are being invested in it 
because it is interactive television and it does not 
necessarily have the best content.
    And, in fact, it was Discovery Channel's content and many 
others that really got it going, and then eventually HBO and 
smaller studios, larger studios, MGM--now we have 15,000 shows 
On Demand. We hope to go to 50,000, 100,000----
    Mr. Nadler. And the second statement, the second 
contention, which is that--I am trying to remember what the 
second one was now----
    Mr. Roberts. About shows on the actual network itself, what 
is--well, TV Everywhere, we are trying to say if--to make a 
relationship for the consumer that they can get--we know 
consumers want to get many products--many shows on the Internet 
or on their computer and on the wireless devices and everywhere 
else--and we are trying to create a licensed, secured, you 
know, not pirated model with the content companies. And we 
would be happy to sit down and figure out how to get more 
content on our On Demand and on our online platform, and that 
is by no means not in our business interest.
    And I think that is the overarching question where I 
strongly disagree with what Dr. Cooper said. And just for the 
record, if you want us to submit the economic theory, and 
perhaps the other economists on the panel may have a differing 
opinion, we would be glad to do so. We don't agree with some of 
the statements he made.
    We are driven because it is such a competitive business. We 
need the best shows or people switch to DirecTV or Dish Network 
or Verizon FiOS or AT&T U-verse or RCN. This business is so 
different than it has ever been before, and each one of these 
negotiations involve lots of money. They are not simple. But at 
the end of the day, we are trying to give the consumer access 
to as much content on as many different tiers as possible.
    We now have 15 different levels of service here in the 
Washington market, so different consumers can pick what 
products they do and don't want. And I think that policy will 
continue as we operate this new company.
    Mr. Issa. Mr. Chairman, point of parliamentary inquiry? Mr. 
Chairman, so for planning purposes for the Members, will we 
continue to have a 15-minute per side or longer? I would just 
like to know how long it is going to be. It has been far beyond 
10 minutes so far.
    Mr. Conyers. Yes, but this is of such significance that I 
have extended the 5-minute rule.
    Mr. Issa. I have no problem, Mr. Chairman. For planning 
purposes, I just wanted to know if there would be a predictable 
time per side so that I could plan my day and all of us could.
    Mr. Conyers. I only wish I could give you assurances that 
would meet your demanding requirements.
    Mr. Issa. Thank you, Mr. Chairman. All of ours. Thank you, 
Chairman.
    Mr. Nadler. Mr. Chairman, in the interest of brevity, then, 
let me ask Mr. Roberts two questions at once and that will be 
it. One, which you got into sort of by mentioning the 
competitiveness, if the business is so competitive, why are 
cable prices increasing at three times the rate of inflation?
    And, secondly, how would you respond to someone who said, 
``Well, given what we have heard from others, we should not 
approve the merger because we don't want to subject the workers 
at NBC to the less than tender mercies of the labor relations 
pattern that we have seen at Comcast.''
    Mr. Roberts. Well, the first question is, I think the value 
and the quality of the delivery of what is cable TV has changed 
over the last 20 years. We have many more channels, better 
quality channels, high-definition channels. We are----
    Mr. Nadler. So you are saying that the value--that it is 
not a fair--it is not fair to look at--you are getting more for 
the price, and therefore, you have to do a different 
calculation?
    Mr. Roberts. And we do have more competitors. In fact, 
DirecTV has a higher charge than Comcast cable.
    Mr. Nadler. So you have to do a different calculation. That 
is too simplistic.
    Mr. Roberts. That is correct.
    Mr. Nadler. Has anybody been able to come up with a proper 
calculation that would show us?
    Mr. Roberts. You know, you can do it per channel. You can 
do it different levels of service. I will be happy to submit 
some responses to that, if you would like.
    Mr. Nadler. Okay.
    Mr. Roberts. The second question on labor, you know, again, 
I am very proud of Comcast's record, disappointed with the 
testimony, but I would, you know, understand that at times 
there may be different points of views from different 
constituencies. But we have built a company from scratch with 
over 100,000 employees. We have one of the highest employee 
satisfaction rates. We are pro-employee----
    Mr. Nadler. Let me just ask you this. I wouldn't be at all 
surprised to hear a labor leader come in and say, ``Oh, the 
employer's terrible.'' But to hear an employee come in and say, 
``You have got two employers, one is great and the other's 
terrible.'' Why?
    Mr. Roberts. Well, cable distribution, cable operations, 
the industry has traditionally not had very many union 
employees, less than, I think, 2 percent industry-wide, and 
Comcast is not an outlier one way or the other. We are kind of 
in the norm.
    The programmed television production part of the company's 
cable channel, Comcast has 13 percent to 14 percent unions in 
our cable programming business and, I think, enjoys good 
relations there. And so one of our commitments upfront is we 
hope to continue the good relations with the guilds and with 
the unions that NBC Universal has. We reached out to a number 
of those organizations.
    I think that deep at its essence there is a view that 
Comcast is genuine in investing and improving NBC Universal's 
quality and quantity of content and that that is going to be 
good for those guilds and those unions, better than the 
predecessor/owner which has many other alternatives to put the 
capital to use all over the world. We are only in the 
entertainment, distribution, and telecommunications businesses, 
and I think our intention is not to buy it to slow it down, but 
to try to expand it and grow it.
    Mr. Nadler. Thank you. I yield back.
    Mr. Conyers. Just before I recognize Bob Goodlatte, Dr. 
Cooper?
    Mr. Cooper. Well, I just want to point out that, until 
Comcast sells programming on a per-channel basis, the per-
channel number is baloney. He sells bundles, and that is what 
the bundle has been doing. The per-channel stuff is meaningless 
because he won't sell it to the public on a per-channel basis.
    Mr. Conyers. Bob Goodlatte?
    Mr. Goodlatte. Well, thank you, Mr. Chairman. And I want to 
follow up on some of the comments of Mr. Berman and Mr. Smith 
regarding copyright protection. I have long said that the ISP 
and distribution community and the content community need each 
other to work to resolve their differences in the private 
sector. And so, as Mr. Berman said, this is going to be a good 
test of that.
    This proposed merger would be an interesting combination of 
these two interests and would add rich content to Comcast's 
portfolio. If this merger is approved, I expect that Comcast 
will begin to appreciate even more the benefits of copyright 
protection.
    In 1998, I was charged by your predecessor, Chairman Hyde, 
with conducting the negotiations that ultimately drafted the--
and ultimately drafted the ISP provisions of the Digital 
Millennium Copyright Act. One important provision requires 
that, in order to receive the immunity of the law, Internet 
service providers must adopt and reasonably implement a policy 
that provides for termination in appropriate circumstances of 
subscribers who are repeat infringers.
    This has been in the news in some countries and some 
locales of late, and I am wondering, Mr. Roberts, does Comcast 
have such a plan in place? And what other specific steps can we 
expect Comcast to do to combat copyright infringement post this 
merger?
    Mr. Roberts. I would like to get it exactly right on the 
specifics. And if I may, I would like to say that I would like 
to submit something on what our policy is on repeat infringers. 
I know that we absolutely contact repeat infringers and notify 
them.
    On your general point, as I said earlier, before this deal, 
but this deal absolutely accelerates, because the technology is 
enabling more piracy. So even when that act was passed, you 
couldn't download a movie or a television show in less than 10 
hours. And now technology has sped that up, or whatever the 
specific would have been.
    So the issue is becoming more urgent, and it is becoming 
more real and more threatening. And we have seen in other 
industries on how disruptive piracy can be, like music and 
others, and so we have engaged all over the country locally and 
nationally with different organizations to be addressing that. 
And I, again, say that I think you are right that one of the 
benefits of this union is it puts us squarely in an opportunity 
role to get to those specifics and improve where we are today 
to make them more binding on the party that is trying to pirate 
that content.
    Mr. Goodlatte. Well, this is a fast-moving area of 
technology, as you know even better than I do, both in terms of 
the efforts that you and Mr. Zucker and others take to protect 
content, but also the technology to pirate that content. And so 
when the Digital Millennium Copyright Act was adopted by the 
Congress, I think there was the expectation on a lot of people, 
including myself, that there would be the use of technology, 
the use of business arrangements and so on to promote the 
protection and expansion of content.
    And it is worked out somewhat, but those industries that 
have not stayed ahead of the curve have suffered more than 
others who have attempted to do so, so it is a--your answer is 
a very important one to me and to many others.
    Mr. Roberts. If I might, I think you are totally right that 
it is critical, and so many parts of the supply chain depend on 
staying ahead with that technology. I think we are on the----
    Mr. Goodlatte. And offering business plans that consumers 
will respect. I mean, now, who would have thought when we wrote 
the DMCA that Apple would be the world's largest purveyor of 
music? But, indeed, they are, because they came up with a 
business model that worked very well for consumers.
    Mr. Roberts. They made it consumer friendly and many other 
great things. And one of--that brings up a critical point. And 
some of the conversations we have been having is to make this--
whatever the next technological solution is, to have it apply 
to as many platforms as possible so that it doesn't become a 
competitive differentiator between providers so that you can 
pirate more easily over here and you can't over there. And that 
is why it is so critical, your involvement and others, to keep 
these industry-wide organizations there.
    I think we, again, look forward now to being able to be a 
significant member of the content community's voice in those 
matters, not just the ISP's voice.
    Mr. Goodlatte. Do you think that the future of television 
is online or will traditional television continue to be the 
primary way that viewers receive content?
    Mr. Roberts. I wish I had a perfect crystal ball. So what 
I--my answer and how I believe we should operate Comcast is to 
not try to guess and guess wrong to that question. So I have 
been saying for years, well before this merger, that I think 
video over the Internet is more friend than anything else. 
There is an opportunity if you start with the consumer and work 
backwards, I think you run a good company.
    And if there is change that has to happen, so be it. Try to 
do the best you can to make it legal change, and come up with 
business models that can work to make that change work for 
consumers, as well as your stakeholders.
    I think that history would suggest--radio is a vibrant 
business in this country all these years later, but it has had 
many changes. What has made the cable industry such an exciting 
industry and why we have been able to add as many jobs as we 
have had and make the tens of billions of dollars of capital 
spending--we spent $5 billion in capital in 2009 alone is 
making these big, large bets.
    So we are betting right now on a technology called 
wideband. We are already beyond broadband, in a 50 to 100 
megabits per second service, so that if that is where the 
consumer wants to consume, we will be the best provider, just 
as we believe we have been the best provider of the last 40 
years in changing television.
    Mr. Goodlatte. Thank you. Let me ask Mr. Zucker, 
representing a rural and small city district that relies more 
on over-the-air broadcast television than most districts, I am 
very concerned about fostering local broadcast programming, 
especially local news and information.
    And I have heard that network affiliates have some concerns 
about the merger, including the fear that NBC will move its 
most popular programming from broadcast television to cable, 
which would decrease viewers and revenues and thus could 
severely impact the ability of these local stations to deliver 
local news and information. Fully a third of my constituents--
probably more than that--are not able to connect to a cable 
system.
    So what assurances can you give me that local programming, 
including that of NBC affiliates, will remain robust if this 
merger's approved?
    Mr. Zucker. Well, the fact is that what--the best thing for 
our programs on the NBC television network is to reach the 
widest audience. That is how we can recoup the greatest 
advertising revenue that is required for investments in 
programs like ``Nightly News'' and ``The Today Show'' and 
``Saturday Night Live'' and those kinds of programs. So it is 
in our interest to make sure that they remain strong and 
vibrant on the NBC television network.
    Mr. Goodlatte. And I have heard some of Mr. Roberts' 
comments in response to Ms. Prewitt's concerns, which I think 
are very interesting and they are important, with regard to 
independent production of television content. What is your view 
of that? Where do you think that is going? How do you respond 
to her? And what kind of assurances can you give us that that 
kind of independent production, which provides a competitive 
environment in the industry, is going to continue?
    Mr. Zucker. I think you have to take a step back and 
realize that, as I think about NBC, we are looking for the best 
programming wherever it comes from. We need the best 
programming. We need to do better at NBC.
    What much of this is about is the financial investment that 
is required in bringing that programming to air. And when you 
consider that 80 percent of all programs fail, there is a 
tremendous financial burden that we take on by investing in 
those programs. So we want the best programs wherever they come 
from, whoever they come from.
    With regard to the financial investment, you know, we have 
shouldered much of that responsibility. And to the degree that 
others are able to shoulder some of that responsibility, we 
continue to be open to that, as well.
    As I pointed out, at NBC, we are now producing 20 new 
programs for next year. More than a third of those come from 
programmers who are not affiliated with NBC or NBC Universal.
    Mr. Goodlatte. Thank you.
    Thank you, Mr. Chairman.
    Mr. Conyers. You are welcome.
    Feeling better, Ms. Prewitt?
    Ms. Prewitt. Well, not exactly, but I am fascinated. I 
mean, I think that it is important to understand in some of 
these conversations that independent programs may well find 
their way on some of these outlets.
    They do not find their way because independents are able to 
go through the door and negotiate to get them placed. They find 
their way because they have separately been picked up by a 
studio and they come into a studio output deal. In the case of 
TV Everywhere and some of the online offerings, in general, our 
members have been told that their libraries are simply not big 
enough for it to be worth the transaction cost to negotiate 
with them.
    But if they will go sell their programming to someone else, 
thereby losing a big percentage of the transaction value, that 
programming can then migrate and come in with a larger package.
    So I think that it is--you know, no one is saying that some 
program doesn't--some programming doesn't make it, like the 
salmon swimming downstream. But the terms on which they are 
able to do that are disadvantageous. They are disadvantageous 
to further investment in production.
    And it is not an open environment in which you negotiate 
what is best. You negotiate essentially what is best four or 
five levels downstream and then take your chances as 
programming moves forward in a package.
    But actually, I am very gratified by Mr. Roberts' comments 
that they are more than happy to talk to us about TV 
Everywhere. But overall, to quote Ronald Reagan, trust, but 
verify. We would like to see something coming out of this that 
is actually, if not bankable, at least independently 
verifiable. Thank you.
    Mr. Conyers. Zoe Lofgren? Oh, she is not here.
    Sheila Jackson Lee?
    Ms. Jackson Lee. Thank you very much, Mr. Chairman.
    Let me, first of all, acknowledge, some friends from 
Houston wanted me to ensure that their constituent, Comcast, 
was aware of their interests in their, if you will, viewing of 
this proceeding. And so I wanted to put their names on the 
record, Representative Sylvester Turner, chairman of the Texas 
Black Legislators, who engages with Comcast locally, and the 
Greater Houston Partnership's Jeff Moseley.
    So I just want you to know that individuals that you work 
with in Houston are well aware of your good civic works, and we 
thank you.
    I believe the quote that I think will go down in history of 
Mr. Schwartzman should probably be noted as one of the good 
ones. This is the greatest media merger since Lucy and Desi, 
certainly speaks volumes to how much of a magnitude this is.
    And I am going to try and pose questions with the idea that 
I think it is crucially important that all of the oversight 
entities, including this Committee, stay intimately involved. 
I, frankly, believe this should not be the last hearing. I 
think Ms. Prewitt has made a point about trust and verify, and 
the opportunity for discussion here, Mr. Zuckerman and Mr. 
Roberts, I think has been very good. It has been good for you, 
and it has certainly been good for us, to be educated about 
this process.
    But I would like to be able to see, as the negotiations go 
forward, as the Department of Justice has its review, that this 
Committee, Mr. Chairman, have the opportunity to have maybe one 
or two more hearings, because I think the oversight is going to 
be key.
    I would like to start with Mr. Cohen. And as I do that, I 
would like all of you to be thinking about the opportunities 
that we have and the elements that have been mentioned, I 
think, in Mr. Morial's comments. Where is the diversity in 
programming, contracts, and jobs? Where's the diversity?
    Clearly, in my office, I made it very clear that we have a 
phrase in our community that one of the more segregated places 
in America on Sunday are sometimes the places of faith. But the 
next is the Sunday morning talk shows. It is almost like there 
is a dearth of expertise and relevance to Members of Congress 
who have a perspective, who happen to be Hispanic or African-
American or other, and certainly in the anchoring, it is the 
same perspective. And we certainly welcome that, but there is 
an absence of diversity broadly speaking.
    Let me pointedly go to Mr. Cohen, if he can capture the 
passion--and thank you for all the work that your workers and 
members do--but tell us what you would need for a fix. What do 
you believe you will be seeing across the board? And what would 
be the necessary fix for trust and verify on this proposed 
merger?
    Mr. Cohen. Thank you for that opportunity and for all you 
do.
    Well, I mean, we really have three concerns. On the jobs 
front internally and the rights of employees internally, the 
problem is that one thing can be said before, and then the 
realities are different after. And there are no warranties in 
this system.
    And I don't want to take up minutes here on the list of 
these restructurings, but particularly the one that we talked 
about in 2002--and in my testimony, I mentioned the difference 
between before and after and the horrible results from 
employees' point of view--the difference between the tolerance 
at AT&T broadband and the realities at Comcast that continue to 
this day.
    And I don't think it is true at all that the labor 
relations practices are the same or similar to others in this 
industry. I beg to differ. I would welcome dialogue. We have 
had no dialogue to this point on this merger, none.
    But the norm in this industry is far different. Seventy-
five percent of workers actually have bargaining rights in this 
industry. And if we are going to define the industry by the old 
standard, the sort of cowboy period of cable, that is fine. But 
this merger is supposed to be about the new world.
    And in the new world, the labor relations here are 
dragging, dragging, dragging standards down, turning people 
into contractors and freelancers, eliminating benefits, health 
care and pension benefits, and they have an effect on all the 
millions of workers in the industry. And, again, we would 
welcome dialogue. There has been none.
    I think that the other is the external. And as I try to 
point out, so what happens is that the bigger consequences of 
this merger, the bundling vertically of content and pipes or 
network, disadvantage investment. So whether it is Houston or 
anywhere else, it lessens the likelihood that the so-called 
competitors, be they telecom or satellite, continue to invest, 
because they must pay more based on the pricing system for the 
content. And without the content, they can't recoup their 
investment.
    And so this is known in the industry as bulk pricing. They 
have fewer eyeballs. Therefore, they got a higher price per 
eyeball. That can be true of a small operator in a rural place. 
It is particularly true of even large operators who have been 
investing billions of dollars, and we now see it drying up, 
whether that is FiOS or whether that is Verizon FiOS or U-
verse.
    And part of that is the way in which they have to purchase 
video and then, secondly, the wall that is up on the Internet, 
try to watch the Olympics, if you are not a cable subscriber. 
You are getting a preview of what the new world is. We don't 
think that is a good world.
    We think the Internet world and the cable world or the 
television world should be separate. And the wall that is built 
shouldn't be a wall between. Here is the deal if you are a 
cable subscriber, and here is the wall if you are not.
    Ms. Jackson Lee. Thank you very much.
    Let me just go directly to Mr. Roberts and to Mr. 
Zuckerman. And if they would--Mr. Zucker, excuse me--if they 
would ask questions, sort of respond. Mr. Cohen has made a 
point. He happens to be representing a large constituent and 
has the responsibility of protection of those individuals.
    I think that, when we talk about growing America, the idea 
that there would be some quality and value to this merger is 
not one that we should ignore. I would extend an invitation to 
both Mr. Roberts and Mr. Zucker to meet with all of us. We need 
to engage over a period of time on the details of this.
    So let me ask both of you, would you engage with Mr. 
Cohen--Mr. Roberts, can you meet with Mr. Cohen?
    Mr. Roberts. Well, I am happy to myself, if you think that 
is best, or our company, whose experts----
    Ms. Jackson Lee. Yes, I think it is best if you would meet 
with Mr. Cohen. Would you do that?
    Mr. Roberts. Yes.
    Ms. Jackson Lee. Can you do that in the very near future?
    Mr. Roberts. Absolutely.
    Ms. Jackson Lee. Thank you.
    Mr. Zucker, can you meet with Mr. Cohen?
    Mr. Zucker. Yes. Yes.
    Ms. Jackson Lee. All right. Mr. Cohen, you can establish 
outreach, and hopefully we will create that opportunity.
    Mr. Cohen. Thank you.
    Ms. Jackson Lee. Let me go straight to this idea that Ms. 
Prewitt has made a point about, that if you come together right 
now, for example, Comcast is a gate-keeper of sorts, and we 
enjoy listening and looking at cable, the excitement that it 
provides, but it is a gatekeeper on programs that will be 
carried on its cable systems.
    It appears that virtually no program service was added to 
any cable system in recent years unless a cable system operator 
had a financial interest in the service. For example, you have 
some minority cable stations that you own a large interest in.
    So the question happens to be, is that the only way that 
you can access now this new entity that will have Comcast 
operating and NBC Universal merged in? Will the only way that 
you access is that you own it? Will there be no opportunity--
which goes back to my broad point--diversity in programming, 
diversity in contracts, and diversity in employment?
    Would you both answer that question? Because, Mr. Zucker, 
you will be merged in. Your programming content will come in, 
but what happens to access for others?
    Mr. Roberts. If I might begin--and then Mr. Zucker--that 
would be against the law if we made our decisions based on 
ownership, and we do not do that. We have had many independent 
channels that we have added to our carriage line-up, and I will 
be happy to get you a list of those in Houston and elsewhere 
over the last several years.
    Six out of every seven channels that we carry--and I think 
the vast majority of the new ones that we have launched we do 
not have any economic interest in, so hopefully that answers 
the question.
    Jeff?
    Ms. Jackson Lee. Mr. Zucker?
    Mr. Zucker. I would tell you that I believe this actually--
this deal will enhance the commitment to diversity in 
programming, specifically Comcast is committed to expanding 
over-the-air programming to the Hispanic community in 
particular, using Telemundo's digital spectrum, and committed 
to launching a new channel to expanding programming on 
Telemundo's cable network, mun2, On Demand programming with 
regard to that. So I actually think this will enhance diverse 
programming.
    Ms. Jackson Lee. I am glad you brought that up. And, again, 
this is trust and verify. We can't have all this confirmed just 
by this testimony that you are giving.
    But you will be holding--Mr. Roberts, Comcast will be 
holding Telemundo and NBC. It is to your advantage that if 
others wanted to carry portions of NBC Universal and Telemundo 
that you could block them by charging exorbitant fees. Do you 
intend to do that?
    Mr. Roberts. No, we do not.
    Ms. Jackson Lee. And how is that going to be characterized, 
by contract, by policy, by affirmation, or----
    Mr. Roberts. There are a number of ways. Start with the 
fact that we have an existing business, so whether it is one of 
their cable channels or Telemundo or NBC, there is, in my 
opinion, the second-largest customer is satellite company, the 
third-largest customer is a satellite company. It is in our 
interest to have their support.
    If they choose not to carry these channels, the channels 
radically are less valuable to the advertiser, to the content 
producer. The entire system depends on that and with so many 
channels, I don't think it changes that incentive.
    As has been pointed out, we are about 24 percent of 
distribution. We have gone backwards the last 2 years, 
continued--lost 200,000 customers because of all this 
heightened competition. We need to carry the best programming, 
and we think, as a content company, we need to get that 
programming carried.
    Now, the FCC has a next level. Any company can go and bring 
a carriage dispute or an access dispute to the FCC, as has been 
mentioned previously in the hearing. So there are 20 years of 
experience, and there is also the existing business that we 
would be buying, and they already have contracts. And then in 
addition to that, any new dealings, there is this overall FCC, 
where folks have been able to bring a complaint.
    Ms. Jackson Lee. Let me put these two questions to you and 
close up. I would like to know whether you would commit to 
adding two independent mergers per year.
    I want Ms. Prewitt to tell this Committee what she wants us 
to do with respect to our vital--most vital role with respect 
to the independents.
    And Mr. Zucker and Mr. Roberts, you have yet not commented 
on my diversity question in programming, in contracts, and 
employment. And so I need you to answer that. And you might 
pointedly look to your most famous Sunday morning talk show on 
its, if you will, guest list for the past decade, and you might 
reflect on that.
    Mr. Roberts?
    Mr. Roberts. I will begin by saying, diversity of----
    Ms. Jackson Lee. Employment.
    Mr. Roberts [continuing]. Of employment and in 
programming----
    Ms. Jackson Lee. Contracts and programming, sir.
    Mr. Roberts. And as well as our minority supplier 
diversity----
    Ms. Jackson Lee. Yes, and if we can get that coming back to 
us in the Committee in writing--you are going to say it now, 
but if you can give us that in writing, that would be helpful.
    Mr. Roberts. I will do so. I will just say that they have 
been externally recognized repeatedly, our diversity efforts, 
top 50 organizations for multicultural business opportunities 
by diversitybusiness.com for 5 consecutive years, 50 out front 
of diversity leadership by Diversity MBA magazine 4 years in a 
row, Diversity Elite 60, and top 60 companies for Hispanics.
    So I think we have a good record. I appreciate the 
opportunity to submit that to you.
    Secondly, we have committed, will commit that for--starting 
in 2011, for 3 years, we would add two independent channels per 
year.
    Mr. Zucker?
    Ms. Jackson Lee. We appreciate that. And we will talk 
further about that. I know you can't go into more details. 
Thank you.
    Mr. Zucker?
    Mr. Zucker. Yes, with regard to diversity, I would just 
like to let you know that I have been in my role for 3 years. I 
made diversity one of my key five strategic goals. One of the 
first things that I did was appoint a chief diversity officer 
reporting directly to me. Paula Madison is here with us today.
    The numbers which we will send to you, I have them today, 
but we will put them in writing, have increased in almost every 
way that you can judge them, and I am proud of that.
    With regard to your specific--I know that you are 
specifically interested in the guest list on ``Meet the Press'' 
over the last decade, and I would suggest to you that you are 
correct and that we need to do a better job there.
    One of the moves that we have made in the last year is that 
the person who now has responsibility for ``Meet the Press'' in 
an executive oversight is Mark Whitaker, who is an African-
American who I would like to make sure that----
    Ms. Jackson Lee. I would be delighted.
    Mr. Zucker [continuing]. Make sure that you see soon. His 
responsibility as the Washington bureau chief of NBC News 
includes ``Meet the Press,'' so it is obviously an area of 
focus for him and for us, and I would tell you that I agree 
with your premise.
    Ms. Jackson Lee. Ms. Prewitt, quickly?
    Ms. Prewitt. Thank you. First of all, I would like to 
comment on the two-channel commitment, that I see diversity as 
a two-sided issue. There is the issue of bringing diverse 
programming that appeals to different cultures and different 
constituencies to the air, but there is also the question of--
which can be done through an isolated channel, and that lets 
people cut their teeth. It gets that programming forward.
    But there is also the question of bringing those messages 
to the wider community. And my argument has always been that 
you want people to see programming made by individuals not like 
themselves. That is where debate happens, and that is what we 
are trying to accomplish.
    And so we would look at a commitment that was not just to 
two channels, but to a minimum number of slots across all the 
platforms, or a percentage of overall acquisition budgets, 
which I gather will grow as a result of this merger, to fuel 
programming which can compete and find a place across network 
television, the more prestigious cable channels, as well as to 
help bring new talent into any new channels that are created.
    Ms. Jackson Lee. And have you met with Mr. Roberts and Mr. 
Zucker?
    Ms. Prewitt. No, we had previously written to studio heads 
to request meetings but received no answer from their offices.
    Ms. Jackson Lee. Well, they are sitting right next to you, 
and I know they have been very gracious----
    Ms. Prewitt. And we will follow up. Thank you.
    Ms. Jackson Lee. And, Mr. Roberts and Mr. Zucker, can we 
have that meeting go forward, as well?
    Mr. Roberts. I am not aware of any communication to us. Did 
you write to Comcast?
    Ms. Jackson Lee. I am sorry. Would you be willing to have a 
meeting go forward?
    Mr. Roberts. I offered that before the panel started and am 
happy to do so.
    Ms. Jackson Lee. Mr. Zucker?
    Mr. Zucker. Yes, ma'am.
    Ms. Jackson Lee. I think, Mr. Chairman, you have been very 
kind. I do restate that I think that we need to--there are 
gentleman that I was not able to inquire, but I heard their 
testimony, will be reading it closely, but I believe this is so 
important and so massive that we should have the opportunity to 
address this question again as it moves forward to the various 
executive agencies.
    I thank the Chairman, and I yield back.
    Mr. Conyers. Howard Coble?
    Mr. Coble. Thank you, Mr. Chairman.
    I apologize to you and the panel. I have been bouncing 
between two different hearings today. And, folks, I promised 
the Chairman I would be 5 minutes, so you all help me along 
with that.
    Today's testimony, when I have been here, has questioned 
current laws and regulations regarding program carriage and 
access. Let me address that with a question. Mr. Roberts and to 
Mr. Zucker, what is Comcast and NBC's experience been with 
these regulations at FCC?
    Mr. Roberts. It has, I think, been an environment that has 
allowed us as a distributor to also invest in content. It has 
allowed other third-parties, when they are concerned about 
their own business dealings, to go to a third party. And I 
think generally the rules have fostered an environment where we 
have seen an explosion of channels, explosion of choices, and 
allowed us to make investments at the same time.
    Mr. Coble. Mr. Zucker, do you concur?
    Mr. Zucker. Yes, sir.
    Mr. Coble. Thank you. Gentlemen, how has this merger--
strike that. How would this merger affect third parties, such 
as small rural providers that seek to carry this content? And 
how do you envision negotiating with these providers?
    Now, I am told that the gentleman from Mississippi asked 
that question. Do you or Mr. Zucker want to extend on your 
answer? If not, I will examine your questions.
    Mr. Roberts. I would stay with the answers given. 
Basically, I don't think the merger has any direct implications 
to that, because the relationships that existed will continue 
to exist. Part of why it is a vertical deal is our two 
companies are in different parts of this business. And I think 
it doesn't change anything.
    Mr. Coble. I thank you, sir.
    Now, Dr. Cooper, I would be interested in your thoughts to 
that same question, because you seem to contend that this 
transaction would probably reduce choice and competition in 
local markets. Now, specifically, Dr. Cooper, do you believe 
this will be a problem in all areas or only in those areas 
where NBC owns and controls a station?
    Mr. Cooper. In my testimony, I make it clear that joining a 
dominant distributor to a major content producer provides 
vertical leverage that will affect all markets, both the 
content market and the distribution markets in which one or the 
other of the entities owns properties.
    Mr. Coble. Thank you, sir. And in conclusion, Professor 
Hazlett, let me put this question to you, if I may. Do you have 
a position on whether this deal may present antitrust concerns, 
in particular geographic markets, A?
    And, B, in particular, I am thinking of circumstances where 
Comcast owns a regional sports network and NBC owns and 
operates a broadcast station. Does this present, in your 
opinion, any competition problems from your perspective?
    Mr. Hazlett. No, I don't think it does. There are issues 
about access to programming that predate the merger and are 
ongoing, will be of interest after the merger, but the merger 
itself does not increase market power in any given market where 
that is an issue.
    Mr. Coble. Thank you all again for being here. Mr. 
Chairman, thank you. And do I get credit for 5 minutes?
    Mr. Conyers. As always.
    Mr. Coble. With your cooperation. Thank you, Mr. Chairman.
    Mr. Conyers. Maxine Waters?
    Ms. Waters. Thank you very much, Mr. Chairman. This hearing 
has certainly been informational and educational, and I have 
learned a lot just listening to the questions and the answers 
over the last half-hour so that I have been sitting here. And I 
think I understand very well what has been stated about the 
desire to go forward with this merger and what does it mean to 
each of the companies.
    But I also understand from those who are opposed to this 
merger, who have questions about this merger why they have 
those questions.
    There are several areas of interest. The first for me has 
to do with diversity. And I have been listening to the 
commitments to diversity, but when I look at the boards of 
directors of both Comcast and NBC, I have questions.
    For example, is it possible, Mr. Roberts, that there are no 
women on the board of directors of Comcast?
    Mr. Roberts. No, that is not true. Dr. Judith Rodin of the 
Rockefeller Foundation is on the board.
    Ms. Waters. How many people do you--how many directors do 
you have?
    Mr. Roberts. Like 12, I believe.
    Ms. Waters. I noted 11. That is on the Internet.
    Mr. Roberts. Let me----
    Ms. Waters. Did she just come on?
    Mr. Roberts. No.
    Ms. Waters. Is it a recent--why would her name not appear 
on the Internet on your board of directors?
    Mr. Roberts. I believe it does. If it doesn't, I will check 
that today. She has been on the board for more than 5 years and 
has been on the board ever since the AT&T broadband merger.
    Ms. Waters. Okay. So you have 12 directors, you have one 
woman, and one African-American, Mr. Bacon?
    Mr. Roberts. We have Mr. Bacon on the board. That is 
correct.
    Ms. Waters. And any Latinos or Latinas?
    Mr. Roberts. We do not, I think, at this time, but the 
governance committee of the board has stated that increasing 
the diversity on the board is one of its top priorities and 
that is an area that we would like to improve, as well as 
additional diversity on the board.
    Ms. Waters. I think that is very important, because when 
you are judged about your sincerity about diversity, it really 
starts at the top. And when you look at the board of directors 
of any organization, it tells you a lot about who they are and 
what they are trying to do.
    Let's take a look at NBC. We are very pleased about Paula 
Madison. She is kind of a twofer. She is a woman, and she is 
Black, and she is connected to the community, and we are very 
appreciative for being able to talk openly and candidly with 
her about our concerns.
    And I guess you have one other woman, Lynn Calpeter. Is 
that correct? Or do you have another woman?
    Mr. Zucker. Within our executive--within the top executive 
ranks at NBC Universal, other than Paula, our CFO, Lynn 
Calpeter, is female.
    Ms. Waters. I just want to deal with the board first before 
we go to the other offices.
    Mr. Zucker. On the board of NBC Universal.
    Ms. Waters. With the board.
    Mr. Zucker. Yes, ma'am.
    Ms. Waters. So you have Paula Madison, one woman, one 
Black. Any other women? Any other Blacks?
    Mr. Zucker. Lynn Calpeter, Bonnie Hammer also--Bonnie 
Hammer, who is the president of USA and Syfy, is also on the 
board of NBC Universal. I believe there is----
    Ms. Waters. Bonnie Hammer?
    Mr. Zucker. Bonnie Hammer.
    Ms. Waters. Not listed on the Internet. You have 19 members 
on the board or 20?
    Mr. Zucker. I don't think that is the board of NBC 
Universal.
    Ms. Waters. Oh, it is not?
    Mr. Zucker. Yes, I think you may be looking--I am not sure 
what you are looking at.
    Ms. Waters. I am looking at the board where Jay Ireland, 
Jeff Zucker, Michael Bass, Lynn Calpeter, Steve Capus, Marc 
Chini, Rick Cotton, Dick Ebersol, John Eck, Jeff Gaspin, 
Allison Gollust, Mark Hoffman, Paula Madison, Salil Mehta, Ron 
Meyer, Richard Pilot, Cory Shields, Peter Smith and John 
Wallace. Is that not the NBC Universal board?
    Mr. Zucker. Those are the executive--I think that would be 
the executives of NBC Universal, the top executives of NBC 
Universal.
    Ms. Waters. Paula Madison is on the board though, right?
    Mr. Zucker. She is one of the top executives of NBC 
Universal.
    Ms. Waters. But she is on the board?
    Voice. They don't have a board.
    Ms. Waters. Is she on the board?
    Mr. Zucker. That is the directors' board, yes, yes.
    Ms. Waters. So is there something different than what I 
just read that is the board of directors? Or is it one and the 
same, your top executives make up the board, plus others? How 
does it work?
    Mr. Zucker. NBC Universal is not a public company, so we 
have a--so we have a legal entity that lists all the top 
executives, which I think is what you are reading from.
    Ms. Waters. I see. Okay.
    Mr. Zucker. So we are not a public board, and I think that 
is----
    Ms. Waters. So this basically is the make-up of the top 
executives who kind of serve in a board capacity, but not 
legally constructed as a board?
    Mr. Zucker. That is an accurate way to look at it. Yes, 
ma'am.
    Ms. Waters. So you have two women, is that right, or three 
women? How may in this 19 that I have counted? Or is it just 
Paula by herself?
    Mr. Zucker. Well, I think it is--Paula Madison is on there. 
I think Lynn Calpeter is on there. I think Bonnie Hammer is on 
there. I think Allison Gollust is on there.
    Ms. Waters. I don't see Bonnie--what is her title?
    Mr. Zucker. Bonnie Hammer is the president of USA and Syfy 
networks.
    Ms. Waters. And are there any more African-Americans on the 
board, in this executive make-up?
    Mr. Zucker. In that executive make-up, no.
    Ms. Waters. Okay. Any Latinos?
    Mr. Zucker. On that board, no.
    Ms. Waters. Okay. So you have got some work to do, too, 
right?
    Mr. Zucker. As I said before, this has been one of my key 
strategic priorities that I put in place when I came into this 
role 3 years ago. I feel we have made progress. There is no 
question that there is more progress to be made.
    Ms. Waters. Let's talk a little bit about programming. And 
I don't know what I am referring to in terms of this season or 
next season, but I am told that there is no Black programming, 
you have no more Black programming. Is that correct?
    Mr. Zucker. Are you talking about NBC right now?
    Ms. Waters. Yes.
    Mr. Zucker. Yes, on NBC? There is not a program on NBC that 
has an African-American-central theme to it, that is correct.
    Ms. Waters. Why not?
    Mr. Zucker. I think we are always looking to--you know, 
diversity is incredibly important in all of our casting and in 
all of our themes. We are looking for programming that covers 
that--you know, that covers both the diverse casting and 
diverse programming.
    With regard to African-Americans, we haven't found that 
program at this time. As was referenced, obviously, we have 
been--we were at the forefront of that, when you go way back 
into the history of NBC, when you go into the more recent 
history of NBC.
    Ms. Waters. That was then, and now is now.
    Mr. Zucker. Yes, today we don't have that program on the 
air.
    Ms. Waters. So, Ms. Prewitt, do you think that they could 
get some help from individual filmmakers to help them with a 
little diversity so that they would not be sitting here in 2010 
with no Black programming?
    Ms. Prewitt. I think they could absolutely get some help. 
And the day they say, ``Go,'' I will have members who are 
prepared to start filling those slots.
    Ms. Waters. But he just said, ``Go.'' He is looking. He 
really wants to.
    Ms. Prewitt. Indeed. Indeed. Well, I will pick up the phone 
and call my board meeting, which is convening now, to tell them 
to get started.
    Thank you.
    Ms. Waters. And so, Ms. Prewitt, are we talking about them 
working with independent developers to--independent filmmakers 
to help develop new shows? How do they get this done? He has 
forgotten how to do it.
    Ms. Prewitt. There are two issues.
    Ms. Waters. They used to do it a long time ago----
    Ms. Prewitt. Well, they used to do it. And one looming 
issue here is, who at the end of the day owns that show? There 
are a number of people who may well be prepared to come in and 
work with the network and have been invited to work with the 
network and then turn the ownership of that show over to the 
network.
    The independents with whom we work wish to retain the 
rights to their shows. They want to be in control of where 
those shows are exploited after the initial network or cable 
run.
    So on that basis, people are perfectly happy to work with 
the network, but the network has to be prepared to sit on its 
hands as they try to grab all worldwide Internet rights or 
things of that nature.
    And if you look back in the--you know, the early days, what 
we think of as the great days, the Bill Cosby days, what you 
will find there is that that programming traveled worldwide 
because the back-end rights were left with the creator. And 
that is part of what we think the process is of forcing the 
creator to take risk, along with the network, to really define 
programming that matters. And on that basis, there certainly is 
a wide community that would be happy to work with them.
    Thank you.
    Ms. Waters. Let me ask what I guess is a business question. 
Is there some assumption that Black programming is not 
profitable? Is that why you don't have it?
    Mr. Zucker. Not at all.
    Ms. Waters. Well, if it is profitable, don't you want to 
make money?
    Mr. Zucker. Yes, we do.
    Ms. Waters. Well, how could you not pursue those efforts 
that would help to make you profitable, more profitable? Tyler 
Perry does very well with Black stage, Black screen, and we 
just love it. We love seeing ourselves on television and in the 
movies.
    And I think that it would be credible to argue that Black 
viewers deserve the kind of content that they feel good about 
and that they are watching television and should have access to 
this kind of programming. I don't understand why you don't 
pursue it and why you don't do it.
    Mr. Zucker. When I mentioned before that diversity was one 
of my key strategic priorities for the company, we didn't make 
diversity a strategic priority for the company just because--
only because it was the right thing to do. We also made it a 
strategic priority because it is good business, as well. And so 
I agree with what you are saying.
    The fact is, we need the best programs we can find, no 
matter who is the lead characters in them. The fact is, we 
haven't done a very good job of finding programs at NBC 
recently, and so that is on us. We need the best programs 
wherever they come from, whoever stars in them, whatever their 
themes are, and we need to continue to do that.
    Ms. Waters. Well, I know that you are pretty, you know, 
important in this country--I mean, in this company, but do you 
know Bill Duke and others who are producers of good Black 
programming?
    Mr. Zucker. Well, I have--I am not involved in taking those 
pitches and, obviously, hearing those ideas, but I can assure 
you that we have increased our funding for diverse scripts and 
diverse ideas dramatically, especially with the help of Paula 
in recent years, the amount of attention that is paid to this.
    The amount of resources that are attendant to looking for 
diverse themes, diverse programs and diverse scripts has 
magnified dramatically in the last 2 years.
    Ms. Waters. But it has not resulted in Black programming. 
You don't have any.
    Mr. Zucker. It doesn't necessarily happen immediately, and 
I think what we have done and what I am proud of is the fact 
that we are attuned to it, the fact that we are putting money 
where our mouths are, and we are looking for that. Whether we 
have had success yet or not, which we--as you have pointed out, 
we don't have any of those programs on the air today. We are--
--
    Ms. Waters. How long do you think it will take?
    Mr. Zucker. I wouldn't want to put a timeline on it. We are 
looking for the best programs no matter where they come from, 
and we have added dramatic resources to help us find those.
    Ms. Waters. How do you determine whether or not it is a 
good program? Do you have a committee that reviews----
    Mr. Zucker. Well, there is a team, obviously, that picks 
the programs. And diversity, including diverse casting and 
themes, is a significant part of what they are looking----
    Ms. Waters. So you have a team of diverse people that 
includes African-Americans and Latinos and women that review 
these products that are submitted to you? Is that how it works?
    Mr. Zucker. Yes, ma'am.
    Ms. Waters. And what are the Blacks on your team saying 
about the inability to find Black programming? What do they 
say, if you have some who actually look at this stuff?
    Mr. Zucker. Yes, we do.
    Ms. Waters. What do they say, ``not good enough''?
    Mr. Zucker. I think we haven't found that program yet.
    Ms. Waters. Well, let me just say that it is very difficult 
to accept that you cannot find the kind of program that I am 
talking about. And it is unacceptable to say that you don't 
know--you have no goals. You don't know when it could happen. 
It may happen. It may not happen. I don't think that Black 
viewers would like to hear that kind of an answer.
    And I think you can do better. And it is not all on Paula 
Madison. It is good to be able to, you know, deflect when you 
are getting this kind of question, and I am not doing it to be 
in a ``gotcha'' moment. I am doing it because I am trying to be 
as open and honest as I can be about your Black viewers.
    Many of us are searching, looking for Black programming and 
having to enjoy shows that are very old, that is repeated, 
because we can't find any new programming that reflects us. And 
we think that is very important, if you are committed to 
diversity.
    And I think that all of the ethnic groups who are viewers 
and who are watching television--otherwise, we don't have a dog 
in this kind of fight. I don't know why we should care whether 
or not you are successful if we are not represented. I just 
don't know why we should be concerned.
    First of all, you have got a diversity problem, you have 
got a labor problem, and you have got an ownership problem. 
There is no ownership in this merger by anybody of color, any 
minorities. Labor's not happy with what you are doing. We think 
we are going to lose jobs.
    So I just don't--I just don't know why I should be 
supportive of your merger. I don't know what it does for the 
people, some of the people that I represent, et cetera, et 
cetera.
    So I want to kind of just make that--put that on your radar 
screen so that you will actually realize some success in the 
area that you are working so hard in. And if you need 
additional help, I will just call all my friends that I know in 
the industry. And I will get Bill Duke and all the producers 
that I know, and I will set up a meeting with you to make sure 
you have reviewed their products, that they have been 
submitted, take a look at your review committee that is 
supposed to be diverse, and see if we can't get this done.
    Thank you very much, Mr. Chairman. I yield back the balance 
of my time.
    Mr. Conyers. We have a vote on. We will be in recess for 
this one vote which has been on. That was the second bell that 
rang. And we will resume shortly. Thank you.
    [Recess.]
    Mr. Conyers. The Committee will come to order. Chair 
recognizes Dan Lungren.
    Mr. Lungren. Thank you very much, Mr. Chairman.
    And I thank the witnesses for being here. As you can see, 
we split our duties in a day, and I have been on the floor and 
other things, so I haven't heard all the testimony. I think I 
have the gist of it, but I would like to ask a few questions.
    I thought it was interesting, and I think it is a serious 
discussion on diversity. I am almost tempted to ask about 
diversity of opinion, but that would suggest that I think that 
networks are biased, and I wouldn't suggest that at all.
    I do want to make sure that, no matter what you do, I can 
still watch Notre Dame football on NBC. That is my particular 
parochial interest here.
    Let me ask this. I come from the general Sacramento area. 
It has been highly competitive. And one of the reasons I know 
that is we have changed who we use. I have had AT&T. I have had 
cable. I have had satellite. I have tried all of them.
    And, frankly, my wife and I do it depending on what the 
best offer is at the time. And whether--I mean, we do it on 
service and we do it on content and we do it on price. I think 
we are like everybody else.
    We have AT&T. We have Frontier. We have SureWest. We have 
Comcast, et cetera.
    And I believe the competition has been healthy, as I have 
seen it and we utilized it. Frankly, I have seen services 
improved over time. And we try and figure out who has got the 
best service at the particular time, and we go with them, so we 
are not one of your loyal customers, I guess is what I would 
say.
    But I am undecided about the facts that are being presented 
here, so I would like to ask a couple of questions, and this 
would be both to Mr. Roberts and Mr. Zucker, and anybody else 
could comment after they do. And I would like to know how we 
would assure that the costs for programming that you now 
control and own would not increase arbitrarily for yourselves 
and contractually with your competitors.
    Because when you merge, as you would merge, there could be 
a human tendency to benefit yourself, your closest person. And 
how do I know that it would not in turn increase the prices for 
customers across the board?
    Mr. Roberts. Well, thank you. And first of all, I am sorry 
that we have lost your business and we will work to get it 
back. But I think it demonstrates the dynamic nature of the 
business and the ever-changing nature of the competitiveness. 
And I think that is a real live example of what the marketplace 
is all about. Every day, we have got to wake up and have a 
better product than we had yesterday.
    First of all, it is not crystal clear that in the past, as 
this Committee and others have looked at whether it was News 
Corp., Direct TV, or Time Warner and Time Warner Cable, that 
other businesses didn't come to the conclusion that there is no 
benefit to even being in the same company. And what has been 
mentioned in previous testimony is that many investors are 
skeptical that there are benefits.
    So I don't think one of those theoretical benefits is to go 
out and raise prices artificially for your own channels. The 
market is just too competitive. There are too many choices. And 
we need the distribution--since we are 24 percent of the 
country, 76 percent you need. And there is a robust market.
    There is also--NBC today is not under the program access 
rules. But because we are vertically integrating, their content 
would now fall under more rules than it has previously, so it 
is hard to see what you are describing as a theoretical happen.
    And other companies, whether it is News Corp. or Time 
Warner, we didn't see that kind of behavior, either. In fact, 
so much of it they ultimately didn't even think they wanted to 
stay in both businesses.
    Mr. Lungren. Let me follow up on that. Would Comcast-NBC 
tie various content packages to their own cable or Internet 
services, which could then thereby impact customer choice and 
create higher costs and unfair competition for customers and 
their competitors?
    Mr. Roberts. I am not sure I follow all the strains of that 
question. I just want to make sure I appropriately answer----
    Mr. Lungren. Well, I am talking about, you know, kind of 
bundling the services. I mean, you are sort of one--you are two 
companies now. You are one company afterwards, essentially. 
Would that have you--NBC give a better benefit in this 
situation to others that might be viewing--seeking that 
content?
    Mr. Roberts. So there are two sides. There is Comcast the 
cable company, six out of every channels, as I stated earlier, 
we do not have any financial interest in after the merger. So 
there is plenty of opportunity.
    And, more importantly, as you pointed out, as a customer, 
to decide based on whether you choose to subscribe to us, 
whether or not we have the best channels available. So I think 
there is three, four, five competitors per market and 
increasing competition all the time from other forms of 
entertainment.
    As far as channels getting carriage, the other side of that 
question, again, there are opportunities for us to carry their 
content and content to get carried by NBC and others. We have 
been discussing that all day. There are program access rules, 
program carriage rules. There has been an explosion of choice 
to the consumer.
    And I don't believe this deal changes that because we are 
really in different parts of the business----
    Mr. Lungren. Okay, well, let me ask this. The customer, me, 
my wife, what does it mean to me? I mean, what am I going to 
see? Are you telling me there is going to be no difference 
whatsoever or I am going to be so pleased with this merger that 
I am going to say, ``Why didn't you do it before, because it 
has given me so much more benefit''? I mean, what is going to 
be in my district for my constituents--what difference are they 
going to see?
    Mr. Roberts. Great question. I think first thing is, we 
hope to improve the quality of NBC's programming, okay? We will 
make this--this is the signature piece of our content. And our 
investment strategy and our management expertise will solely be 
focused on improving the quality.
    Mr. Lungren. Well, my alma mater is trying to help you, 
because we have a new football coach, so we hope that----
    Mr. Roberts. And we thank you for that. And----
    Mr. Lungren [continuing]. The product on the field will be 
better in the coming years.
    Mr. Roberts. Second is accelerating the technology that 
your customers are going to be able to use to get more content 
on more devices faster. We are convinced at Comcast that there 
is a technological moment in time, explosion of choice with the 
digitization of these industries, and they are changing all 
over the world.
    And our company for 40 years has just been a cable company. 
We then invested in broadband, and that changed our company. We 
invested in phone, and that changed our company. And we think 
investing in content will continue to change our company and 
make it a better company with innovating faster, more 
creativity for our consumers than we are if we just stay doing 
what we are doing.
    Mr. Lungren. Mr. Zucker, if I am someone who enjoys NBC, 
watches it, I get it through the system I get now, what is 
going to be the impact on me from the standpoint of NBC?
    Mr. Zucker. Yes, I think that I would echo some of the 
comments that Mr. Roberts made. I think, first of all, 
Comcast's willingness to invest in NBC is good for NBC and 
should lead to greater opportunities for independent 
programmers and for your consumers who hopefully will be able 
to watch more and hopefully even better programming. So I think 
that----
    Mr. Lungren. Well, it is a capital infusion question.
    Mr. Zucker. So that--well, the capital infusion I think 
will be--will be very helpful to us. I think, as Mr. Roberts 
said, the fact that the ability to provide that content 
anytime, anywhere will also be a benefit to the consumers and 
your constituents.
    And I think--I would not underestimate this commitment to 
the broadcast model so that the station in Sacramento, the NBC 
affiliate there, KCRA, which is a fantastic affiliate--we are 
very proud of our relationship with them. The fact that free, 
over-the-air broadcasting will remain vibrant and strong, which 
has been under a lot of duress in recent years, I think is a 
very important thing to happen here.
    Mr. Lungren. Well, that brings up another area of concern 
that has been at least expressed to me by some of the 
affiliates. Are they--are they in a weakened position now as a 
result of this?
    And the reason I say that is this. When I was in Congress 
in the 1980's, we had the explosion from telephones, the 
breakup of AT&T. No one could truly forecast what was going to 
happen. And here we were in Congress trying to pass laws, and 
technology outstripped us every single time.
    So when I look at what we do, whether it is overseeing a 
merger, whether it is new legislation, it is, can we anticipate 
what the possibilities of technology are so that the laws that 
we pass and the decisions we make will be appropriate not just 
today, but 5 years down the line?
    One of the things that I noted when we had the big 
snowstorm here and when we had the big storms back home, you 
know, you turn to your local television station or your radio 
station--in most cases now television, because they have more 
news--to learn about what the weather is, to learn about where 
the problems are.
    It is nice to get the national. It is nice to get other 
kinds of things. But, man, they do serve a real public purpose 
and public service. How do we make sure that they are not 
disadvantaged by your larger market power, so to speak? I mean, 
you are a bigger gorilla than after this merger than you are 
now.
    And how can I be assured that the--the affiliates are not 
going to be disadvantaged by that, and to the extent that then 
it would have negative economic effects on them such they may 
be forced to cut back on their commitment to newsrooms, cut 
back on their commitment to keep people apprised of what is 
happening in their area?
    Mr. Roberts. Well, I will weigh in, if I might, and then 
Mr. Zucker may want to--he has the relationship today with the 
affiliates. We have made several upfront commitments.
    Probably the first, most important commitment is doing the 
deal itself. This begins with GE deciding to sell NBC. And one 
could think, where might that have gone? One answer is the 20 
percent owner is Vivendi. Perhaps Vivendi would have bought the 
other 100 percent. Perhaps it would have been another media 
company that would have said, I already own a broadcast system 
or I already own other things, a studio that NBC owns.
    We are making a commitment that, as has been pointed out, 
is not universally guaranteed success. This is a very, you 
know, big gamble, I believe, hopefully wise, hopefully at the 
right moment in time.
    GE has, you know, said that they aren't happy that NBC's in 
fourth place, but they have other investment opportunities to 
invest in other businesses all over the world, in 
infrastructure and other things. For Comcast, the opportunity 
to try to restore NBC and its cable networks and to continue to 
grow them and invest isn't lip service. It is the mission. Why 
else would you buy it? Many other companies chose to pass, I am 
sure, on wanting to get into some of these businesses today.
    So we are making a bet on the U.S. economy turning around. 
We are making a bet that advertisers and car companies are 
going to come back to advertising, that the future is brighter 
than the present. And I think we are--you know, we are 
confident and excited about that, but it starts with the 
essence of your question, which is, you wouldn't do that if you 
weren't really willing to make an investment in growth and in 
future and in job creation that we are coming out of this 
cycle.
    It doesn't have to be this month, but it has to be at some 
point or probably the trend that has happened in the past, 
where some of these businesses have declined will now turn 
around.
    Mr. Lungren. Yes, sir.
    Mr. Schwartzman. Thank you, Mr. Lungren. I have three very 
brief points I would like to make in response. First of all, 
Mr. Roberts has introduced a red herring here, because 
Vivendi--and Mr. Morial made the same point, that he was 
concerned that NBC go to an American company. The suggestion 
that Vivendi might buy NBC is just wrong, because as a matter 
of law, the Communications Act prohibits the operation of 
broadcast licensees by aliens, so that is just a complete red 
herring and an effort to suggest a threat that doesn't really 
exist.
    Second, Mr. Roberts talks about program access and program 
carriage rules in several occasions and saying, even suggesting 
that they have been beneficial to Comcast operations. It has 
challenged the legality of both the program access and program 
carriage rules, and we have asked Comcast to withdraw its legal 
challenge to the program access rules. And thus far, it has 
refused to do so.
    To the extent that he said they might comply anyway 
voluntarily, that is not very reassuring, and that assumes that 
those rules are sufficient in the first place. And as I said in 
my prepared testimony, we think those rules aren't sufficient.
    The third point is that the continuing legality of those 
rules--of the program access rules, they only run for 2 more 
years. And Mr. Roberts is not committing to comply with them 
beyond then.
    Mr. Lungren. Dr. Cooper?
    Mr. Cooper. Mr. Lungren, so you are concerned about 
predictions about what is going to happen to your constituents. 
And I think when you allow a company that represents a quarter 
of the market to give guaranteed access to programming--now NBC 
and Comcast argue about the price of the programming, they 
argue about the channel location, they argue about the bundle 
size.
    You take that argument away, and now they have a 
commonality of interests, so they certainly have a commonality 
of interest on bigger bundles. Comcast now has a proprietary 
interest in pushing NBC programming in big bundles. They will 
certainly continue their policy of not allowing you to buy 
channels on a single basis, but now they own a bunch of 
programming which they really want to keep in the bundle, and 
they are going to put it in the bundle. So they will continue 
their bundling activities.
    Second of all, they will try to tie Internet distribution 
to cable distribution. That is their TV Everywhere model. They 
want to preserve that cable subscription and prevent other 
cable operators and other people from selling Internet-only 
service.
    And those two things are a big deal to your constituents. 
They really could use true choice on a channel-by-channel 
basis. They really could use the Internet as a platform that 
breaks their market power. And when you combine one of the top 
four programmers and look at the popular programming--not the 
500, look at the top 30--that is where NBC has specialized, 
along with a handful of others.
    You take that dominant programming, must-have programming, 
marry it to regional must-have programming, add it to a quarter 
of the market guarantee. Every company in America would love to 
have a guaranteed quarter of the market. That gives them a lot 
more bargaining power when they deal with everyone else. This 
will raise your price and reduce your choices, especially if it 
entails the Internet.
    Mr. Schwartzman. I have one more thing. It is about Notre 
Dame, so if I might get a second bite at the apple----
    Mr. Lungren. Only if it is positive.
    Mr. Schwartzman. Well, it is a concern. NBC is restricting 
online availability of the Olympics to cable subscribers. If 
you want to watch online--the Olympics online, you must 
authenticate that you are already a cable subscriber. Once 
Comcast acquires NBC, they may put the Notre Dame programming 
so it is only available online to Comcast subscribers.
    So that is the kind of concern that we have when you 
migrate this stuff to the Internet.
    Mr. Lungren. Dr. Cooper, you brought something up that has 
been a question of mine. It comes out of my just individual 
experience, and that is, the difficulty in buying a la carte. I 
used to have one--I wanted the Western Channel. I happen to 
love to watch old Westerns. And you could only get it bundled 
with something else.
    When I came to Congress and my salary went down, my wife 
said, ``You are going to suffer along with the family, so we 
are not going to have the Western Channel anymore.'' Came home 
one day, tried to turn on one of those things, it wasn't there.
    And that has bedeviled me, why it has been so difficult for 
a la carte pricing?
    Mr. Cooper. Well, the cable industry will give you all 
manner of economic explanation about the recovery of costs, but 
the interesting thing is that you don't have those costs on the 
Internet. You don't have to build systems. You don't--there is 
no geography on the Internet, and that is what really gets our 
attention at this effort to require a cable subscription or an 
MVPD subscription in order to view Internet content.
    That means that the company that sells me my cable 
subscription is, in fact, preserving its business relationship 
to me. And if I cut that relationship, I don't have any way to 
view this programming on the Internet.
    So the key here is that their control over the market, 
their bundling--they have been able to impose the bundle. And 
we have tried for years to find a variety of ways to break that 
bundle. I have testified before a variety of Committees in 
Congress.
    It is a question of the exercise of market power. And here 
you have a moment where the Internet comes along. NBC has 
invested in a competed alternative distribution system. They 
need to kill that threat off, because on the Internet, you do 
tend to buy individual channels.
    Someone mentioned the iTunes model. You buy individual 
songs on iTunes, a perfect model for selling digital content. 
So this is the key moment, to stop the practice from physical 
space. That you have noticed. They didn't give you true choice. 
And prevent them from undermining choice in cyberspace.
    Mr. Lungren. Thank you, Mr. Chairman.
    Mr. Conyers. Steve Cohen?
    Mr. Cohen of Tennessee. Thank you, Mr. Chairman, once 
again, proving all things comes to those who wait.
    First of all, this has been very enlightening. Mr. Zucker, 
I have seen you on television, particularly with the Conan-Leno 
world, which is, no, not your favorite moment, but now I know 
who Bob Costas has been doing an impression of all these years. 
You sound a lot like Bob Costas, or he sounds a lot like you.
    Mr. Harper started his remarks talking about Mr. Roberts 
and his father's company starting in Tupelo, Mississippi, and I 
found it interesting to hear that the reason you started it is 
because the folks there couldn't get their antennas to pick up 
Memphis. I don't think that is why Elvis and his family left 
Tupelo and went to Memphis, but there are lots of reasons to do 
it, and I want you all always to remember that Memphis is 
responsible for everything.
    Elvis and Memphis. Before there was Elvis, there was 
nothing. That is what John Lennon said. Before there was 
Memphis, there wasn't any Comcast. Remember that.
    I concur with some of the remarks made by my colleagues, 
Sheila Jackson Lee and Maxine Waters, about diversity and 
minority representation on the station. But I am correct, Mr. 
Zucker, does not Harold Ford, Jr., who is a Tennessee Nine and 
my predecessor in this position, appear quite frequently on 
NBC?
    Mr. Zucker. He does quite frequently.
    Mr. Cohen of Tennessee. And is that kind of unique among 
the networks for an African-American to be that frequent on the 
networks?
    Mr. Zucker. Well, I think we are actually quite proud of 
our--the diversity that we have on our news and cable news 
program. And I think Mr. Ford is the latest example of that, 
and I think we have done quite a good job there.
    Mr. Cohen of Tennessee. It is a good--the district brings 
those type of people forward. Was Al Roker one of the first 
African-American weather people on the networks?
    Mr. Zucker. Yes, I----
    Mr. Cohen of Tennessee. Or the first?
    Mr. Zucker. If he wasn't the first, he was the first with 
such a prominent role as he has played on ``The Today Show.'' I 
think our history of diversity in our news programs has been 
quite strong. My first job at NBC was actually as the writer-
researcher for Bob Costas, and I think that is where I may have 
picked this up.
    But after that, my next job was at ``The Today Show,'' 
where Bryant Gumbel played a huge role in turning ``The Today 
Show'' into the most-watched morning show in America. And it 
was joined by Al Roker not there long after. And today, Mr. 
Roker continues to play a huge role. Lester Holt is the anchor 
of weekend ``Nightly News'' on NBC News.
    As you have pointed out, Mr. Ford plays a prominent role on 
analysis on our news programs. So we are quite proud of the job 
that we have done with regard to that.
    Mr. Cohen of Tennessee. And I was going to bring up Bryant 
Gumbel. I appreciate your mentioning, but I was really in 
another vein with Al Roker. My next movement was to be the band 
leaders.
    And I remember Skitch Henderson and Doc Severinsen, and, of 
course, we all know Paul Schaffer, who does so much Warren 
Zevon to keep David Letterman entertained, and I appreciate 
that.
    Mr. Zucker. I am not familiar with that program.
    Mr. Cohen of Tennessee. You should be.
    Mr. Zucker. I am.
    Mr. Cohen of Tennessee. But was Kevin Eubanks the first 
band leader on a nighttime show that was African-American?
    Mr. Zucker. Yes, sir. Yes, sir.
    Mr. Cohen of Tennessee. And if you notice, there is a theme 
there with Al Roker and Kevin Eubanks, follicly challenged 
individuals. I support that.
    Mr. Zucker. And I am supportive of that, as well. That is 
their--that is their claim to fame, exactly.
    I think that all of these things point out that obviously, 
as I said before, diversity has been an incredibly important 
part of what we have tried to do at NBC, NBC Universal, NBC 
News, and I think we have done a good job.
    It will never be perfect, but we have done a good job, and 
I am quite proud of the record that we have shown both in news 
and entertainment.
    Mr. Cohen of Tennessee. If my memory is correct--and I am 
not a student of broadcast journalism or executives and 
networks--but I think David Sarnoff was known as being a pretty 
good fellow and doing things to see that there was diversity 
and being against discrimination.
    I don't remember Mr. Paley so well. I think he was thought 
of as a pretty nice fellow. And I don't know who ABC had, I 
think, at Disney. I don't know who they had. But Mr. Sarnoff 
was a leader. And he might have been the leader. So your 
network does have some roots.
    Mr. Zucker. We are very proud of the record that we have 
had, especially with regard to African-Americans in prominent 
roles, in first roles, dating back to the advent of television. 
And I think that that is a position that we continue to believe 
very strongly in. And I think you see that every day on the NBC 
television network.
    Mr. Cohen of Tennessee. Now, I know you have never heard of 
that guy, Letterman, and he has got his Top Ten lists, and you 
mentioned you got a top five list. You hadn't quite got the Top 
Ten yet.
    You have mentioned diversity. What are the other four 
issues on your top five list?
    Mr. Zucker. Yes, the strategic priorities that I have laid 
out for the company are, first and foremost, great content, 
whether that is in television, film, local, at our theme parks 
having great rides, having great content, because this entire 
conversation that we are having, none of it matters if you 
don't have great content.
    Digital and the transformation to digital in this new world 
that we live in is another priority. International growth is 
another priority for us. Making sure that we move from an 
analog cost structure to one that anticipates the new digital 
world and all the changes that that brings along is fourth. And 
then diversity would be the fifth.
    Mr. Cohen of Tennessee. Is there any reason for any of the 
local folks to be concerned that you will take the local 
stations off of broadcast?
    Mr. Zucker. Comcast has made a clear commitment--I think it 
is number one on their list of commitments that they have put 
forward with regard to this merger--that there is a commitment 
to free, over-the-air broadcasting.
    That commitment should not be underappreciated in this day 
and age when broadcasting models are the single source, ad-
supported model is under a lot of stress. And so keeping NBC 
and Telemundo strong, vibrant and over-the-air should give 
comfort to all of those local affiliates.
    Mr. Cohen of Tennessee. Mr. Roberts, I asked you 
yesterday--and I just want to understand the issue--the Comcast 
is the provider in Memphis, Tennessee.
    Mr. Roberts. That is correct.
    Mr. Cohen of Tennessee. And many of my constituents of my 
persuasion were upset that MSNBC was taken out of the free 
tier. Is there a manner where constituents in my district can 
get MSNBC in the free area now? Or would there be--will there 
be one in the future?
    Mr. Roberts. Yes to both. When you say free, I think you 
mean the first level----
    Mr. Cohen of Tennessee. Basic.
    Mr. Roberts [continuing]. Expanded basic. And--we are going 
through the same--we are going through the same kind of 
transition that the whole broadcasting industry went through 
with conversion to digital. And as Jeff just said, that is a 
way for us to reclaim bandwidth and then have more high-
definition, faster Internet, more On Demand choices.
    So we are taking certain analog channels and rebroadcasting 
them in digital. Any customer that wants that service for no 
additional charge can get the device to convert you to digital. 
Eventually down the road, they will all be digital, and we are 
just in that transition period, and we need to advertise that 
better, and we want to work with your office to make that more 
understood.
    Mr. Cohen of Tennessee. Thank you very much, sir. I yield 
the balance of my time.
    Mr. Conyers. Darrell Issa?
    Mr. Issa. Thank you, Mr. Chairman.
    Mr. Zucker, just to finish off on a couple of questions 
that my colleague from Tennessee began, NBC has led in a lot of 
areas, but I have it on good authority that ``Make Room for 
Daddy,'' featuring the first prominent Lebanese-American----
    Mr. Cohen of Tennessee. Buried in Memphis.
    Mr. Issa [continuing]. Who is buried in Memphis and for 
whose hospital you had better take good care of there--began on 
ABC. NBC did not avail itself. He had to go to CBS. ``MASH'' 
with Jamie Farr, CBS. It wasn't until ``Monk'' that you got 
into the game.
    Now, I am not going to ask you to explain why it took you 
so long to outreach to Lebanese-Americans or why we still feel 
that we are very underrepresented. We will move on to just a 
few other questions.
    Dr. Cooper, I have the honor of being a Member of Congress 
on this Committee and not being an attorney and being just a 
lowly businessman. So whenever I try to understand antitrust 
and the considerations, I always try to say, okay, relevant 
market, you know, what blocks entry, what are the barriers and 
so on.
    So maybe you can help me with a couple of items. If there 
were unlimited content out there available either for free or 
free when attached to some advertising, if there were unlimited 
bandwidth--let's just say we discovered the terahertz bandwidth 
and you could have all the broadcast in the world--if the cable 
companies through breakthroughs in cable or fiber were able to 
have 1,000-fold more bandwidth, and if any pricing scheme was 
always a cost-plus, a pass-through with some minimal add-on by 
providers, whether they be over-the-air, a cellular event, 
FiOS, whoever, if that were all in place, do you have any 
objections to this merger.
    Mr. Cooper. The hypothetical you have given me--and I have 
been an expert witness for 30 years, and the first lesson you 
do is make sure you actually don't accept the hypothetical--if 
that were true, we would live in a wonderful place, but none of 
that is true.
    Mr. Issa. Okay. Well, let me go through this again, though. 
And actually, I will go to Mr. Roberts, because he is enjoying 
this too much on the end of the table there. What is your 
bandwidth today for being able to broadcast, let's just say, 
low-def level, you know, 480, in number of channels versus what 
was it, let's say, 20 years ago? Just give me a round number, 
if you know it.
    Mr. Roberts. Probably has gone in 20 years from 150 
megahertz, which would be, say, 30 channels to 860 today. And 
then when you multiply the digitization that occurs within that 
bandwidth, which is 10 to 20 times, you can begin to get the 
range of the outcome.
    Mr. Issa. So essentially we have gone from 30 to 1,000 
potential channels before you get into basically an On Demand 
or a system in which you push out more channels, but deliver 
them from a server locally, which is----
    Mr. Roberts. The only thing that would not get you to 1,000 
was that we then devoted, let's say, 100 into high-def, and 
high-def took two and three times the capacity, where--you 
started with low-def----
    Mr. Issa. Having help pay for the model station and all 
that work when I was at the Electronic Industries Alliance, 
trust me. We are acutely aware that that was a tradeoff. So we 
did go for quality, not quantity in that case.
    Mr. Roberts. We also had On Demand, to your point.
    Mr. Issa. Right. So if we look at it as sort of the old 
standard, we have gone from 30 to 1,000. And if we go to an all 
On Demand, then it is virtually infinity, because you can push 
down 1,000 things to various sub-areas or 100,000 things and 
then they can be divided up to each individual TV.
    And if you eliminated all your cable and you only had your 
broadband, you could essentially have an unlimited amount of 
channels delivered through that system, only limited by how 
many the last mile would achieve, with today's predictable 
technologies. Is that true?
    Mr. Roberts. I think there is a theoretical that you could 
somehow get to that scenario, I think so.
    Mr. Issa. Okay. Dr. Cooper, I will go back to you, because 
although I can't guarantee you that the cellular network will 
roll out on that model, they could. I can't guarantee you that 
FiOS and others can roll out on that model, but they could. I 
can guarantee you we are not in the near future going to find 
enough bandwidth over-the-air generally in a non-cellular way, 
so we will eliminate that part of it.
    So if you recognize that we are increasing bandwidth at an 
incredible way, assuming now only that Mr. Roberts' company and 
companies like it are not prohibited from any way impeding 
others getting on to that digital highway and delivering 
content if I want it, do you see why we are leading toward a 
question of, if not now, is it foreseeable that in the future 
good content will have no limit to being able to get to me, 
should I choose to want it, even if Mr. Roberts, through his 
selection of channels, chooses not to have me, let's just say 
because I want 25 million, to let his channel have it and he 
doesn't want to pay it, but I can still send it on a 
subscription basis through the Internet.
    Does that affect your thinking at all?
    Mr. Cooper. Well, here's where your hypothetical has bumped 
into the antitrust laws. Of course, the antitrust laws are not 
``it could be,'' but ``what is'' and ``when will it be?'' And 
if in the relevant timeframe--and we tend to use a couple 
years--it won't be. It isn't today--we know that--and it won't 
be within the relevant timeframe, then antitrust looks at the 
market as it actually is, not the hypothetical market, first 
answer.
    Mr. Issa. Okay. Give me only two answers, because I am a 
very simple guy. Remember, I am not an attorney.
    Mr. Cooper. Second answer is that TV Everywhere is an 
effort to prevent that from happening. So essentially what that 
deal says to the public is it says, look, you have to subscribe 
to cable or another MVPD in order to get Internet content. And 
the effort here--the two biggest guys have made the deal--the 
effort here is to signal to the rest of the industry that the 
gentleman's agreement that has existed in physical space--let's 
be clear: Comcast has never chosen to compete in physical space 
with a neighboring cable operator. It has never overbuilt 
someone.
    It could have--at least since the 1996 act, it could have 
entered someone else's service territory to compete. It might 
claim there are difficulties, construction costs, et cetera, 
in----
    Mr. Issa. I would only ask that you not apply that to the 
District of Columbia, where my own scheduler had multiple 
choices and chose to go from one cable provider to another 
within her apartment complex and is so delighted to have left 
the unnamed other company.
    Mr. Cooper. Well, but that company never has. They have 
chosen not to compete. They have occasionally been the target 
of competitors who would come in here and----
    Mr. Issa. Actually, they were the winner in that particular 
one. That is why I didn't name the one that she left.
    Mr. Cooper. And the guy who is in bankruptcy will explain 
to you why denial of access to programming helped put him 
there. So in cyberspace, however, there are--those impediments 
don't exist.
    Mr. Issa. Okay, well, let----
    Mr. Cooper. Now they have made this deal, to require me to 
get Internet content to subscribe to a cable operator. That is 
a market division scheme. That is an antitrust----
    Mr. Issa. Okay, and a given. Mr. Zucker, I am now going to 
concentrate the rest of the time on you, because, first of all, 
I have got a lot of time with broadcast and not all of it was 
good, so I want to try to enjoy my time here today asking you 
some questions.
    You currently have the ability to send how many broadcast 
channels if you choose to go to your lowest resolution today 
with your new spectrum in the markets where you have some?
    Mr. Zucker. Three.
    Mr. Issa. Do you anticipate being able to potentially go 
further with the existing spectrum in any time in the future?
    Mr. Zucker. In each local market you are talking about?
    Mr. Issa. Yes, sir.
    Mr. Zucker. Yes. That is about what we will----
    Mr. Issa. At 720, you can do three.
    Mr. Zucker. Yes, exactly, so that is about it.
    Mr. Issa. You want to give me that old fuzzy stuff, you can 
do a lot more, but it is 720p.
    Mr. Zucker. Well, high-def and all of that, I mean----
    Mr. Issa. Right.
    Mr. Zucker. Yes, so----
    Mr. Issa. Or as I like to say, having come from the 
industry, higher but not what I call high. But at that point, 
you have three. How many channels does NBC currently produce--
obviously, not broadcast--but all forms, how many channels do 
you believe you own, how many network, sub-networks?
    Mr. Zucker. You know, more than 20.
    Mr. Issa. More than 20. So broadcast is really a relatively 
small amount of your model now, compared to what it once was.
    Mr. Zucker. Completely. Broadcasting accounts for less than 
10 percent of our operating program. The name of the company is 
NBC Universal, but NBC accounts for a minimal part of our 
revenue and profit.
    Mr. Issa. So although Dr. Cooper is talking not about you 
as a content entity, because the truth is, Mr. Roberts has the 
ability to start content and build it to create studios. He can 
do all of that. There is no barrier for him choosing to do it. 
And with what he is paying for you, it would be less expensive 
to do that, but that is a business decision.
    You could, for all practical purposes, walk away from every 
transmission capability, all your bandwidth, and simply take 
your content, walk out one day, and deliver it to cable or 
DirecTV or anybody and you would still have what percentage of 
your revenue, not knowing bottom line, but what percentage of 
your revenue, if you cease to be a broadcaster in the old 
system?
    Mr. Zucker. Well, probably more, because it would continue 
to be a majority.
    Mr. Issa. Okay, so trying to understand the market that we 
are being asked to, we have been modeling here today--and the 
Chairman's been very generous with everyone having an 
opportunity to try to model it--we have been modeling some old 
models. You know, we are sort of thinking that the Peacock, 
before it was in color and then when it was first in color and 
then when people fooled around with it for a long time trying 
to figure out how it was going to look, but, in fact, what we 
are really talking about is a broad content designer, producer, 
licenser, enabler who, in fact, is more and more looking for 
places to go, including cable, all cable providers, DirecTV, 
and the Internet, right?
    Mr. Zucker. Well, I think this is the most salient point of 
the entire day, which is that much of what we have been talking 
about here, whether it is old Simpson rules or casting of 
television shows or access to have your programming out there, 
the world is incredibly different today, and it is more 
different today than it was 2 or 3 years ago.
    And to apply the old rules when 30 years ago three networks 
owned 90 percent of all television viewing and to think that 
that is the way it is today, we live in a multicultural 
society. That is why the programming, the casting of our TV 
programs today is multicultural. It is not all one ethnicity. 
It is why the idea that there are barriers to access of where 
programmers can bring their material and it is to just one of 
the networks is looking at the world 20 years ago.
    The world is incredibly different. And to apply the models 
that were in vogue 20, 30 years ago doesn't work today.
    Mr. Issa. So let me just briefly summarize. You make a lot 
more money not broadcasting. You are a content creator looking 
for distribution, looking for every distribution, including 
through all cable networks. You live or die based on whether or 
not, in some way, shape or form, somebody's going to pay for 
your content. A chunk of your content is advertiser attached, 
although sometimes not.
    Your competitors or everybody who is creating content, all 
of you have a Web presence, more all the time. All of you, in 
fact, are perfectly willing to have a model in which your 
subscriber is a direct customer through some transport which is 
ubiquitous. See, if I was a lawyer, I would be able to see that 
more clearly.
    The fact is that, whether I get it on my cell phone, I get 
it through my cable provider, I get it through a fiber optic 
link somewhere else, or, quite candidly, anywhere I go, I 
simply log in and it is there for me on the Internet the way 
Sirius-XM is both broadcast from satellite and available on any 
Internet connection, that is who you are.
    Mr. Roberts has made a decision to make an acquisition 
because he thinks it is a good combination, but he is in an odd 
situation. Everyone else who is like you--if I understand 
correctly--is able to do all the same things you do, and he 
either now or likely throughout all of our actions is not going 
to be able to prohibit your competitors from jumping on to his 
backbone, even if he owns you, and at least, at a minimum, 
delivering content directly to my PC, which is a media center 
that goes to all my TVs.
    Did I misunderstand any of that?
    Mr. Zucker. I think you got it exactly right.
    Mr. Issa. Mr. Chairman, hopefully for both of our 
deliberation, that will add to our small body of knowledge. 
Thank you, and I yield back.
    Mr. Conyers. Judge Hank Johnson?
    Mr. Johnson. Thank you. It is hard to follow a mind like 
Darrell Issa's. And then, I must admit, during my prior career, 
I was an attorney. And so I feel like I have been set up here 
to seem like attorneys throughout the country look either good 
or bad. And so----
    Mr. Issa. If the gentleman would yield, it is my 
inferiority complex. I hope you didn't take it in any other 
way, Hank.
    Mr. Johnson. No, I did not. Now I am worried about my 
inferiority complex.
    But I do understand that our regulatory environment, 
including antitrust regulation, has to be flexible enough to 
allow for ingenuity and innovation. Before I proceed, I will 
share this.
    Back around 1993, 1994, 1995, in that era, in that time 
period, I was faced with a cold slap in the face, a harsh 
reality set upon me. It was during--it was around September, 
whenever the football season started. And I turned on channel 
six, CBS in Atlanta. They say you could get two, channel two 
was NBC, channel four was ABC, channel six was CBS.
    I turn on CBS, channel six, and, you know, because the 
football game is on, and it was not CBS anymore. It was FOX. 
And I tried to find CBS somewhere around and had to go up to 
channel--I still don't know what channel--where CBS is now on 
the channel.
    And since then, we have had so much change coming at us, it 
is almost like now I don't even get upset about it. I just try 
to adapt to it. And I certainly want our business or our 
regulatory system to be able to do that same thing, adapt to 
current realities which are changing on a daily, if not moment-
by-moment basis.
    I guess at some point in the future there will be like a 
watch that could plug in to. You can get the time. You can your 
news. You can get your content on that watch. And you can even 
take a phone call on it. And then you can--when you need to add 
something up, go to the calculator that is already there on 
your watch.
    And so the content being delivered in forms that--or in 
ways that we can only dream of now, but others are working on 
that stuff, and they are working not just in America, but they 
are working in China, they are working in India, because, right 
now, we don't really share much international programming, but, 
you know, with all of the migration going on and the fact that 
we are living in a world of global economy and a global world, 
we can't assume that content will remain limited to that which 
is produced in America.
    So, you know, I am looking toward the future without 
knowing how it will actually go in this industry, as well as 
other industries. And that is a cause for concern for some, and 
it is also a cause for curiosity from others. And those with 
the curiosity will be the ones to come up with new ways of 
doing things differently than we have done them in the past.
    And then as far as cost goes, I don't know--even a 
haircut--I forget how much I used to pay for a haircut, but 
now, you know, I see haircuts being offered for $20 bucks. And, 
Mr. Zucker, I am sure you don't have to really----
    Mr. Zucker. I was not aware of the current prices of 
haircuts. [Laughter.]
    Mr. Johnson. But I say all that to say that, you know, I am 
open to this vertical merger. I do associate myself with 
remarks that have been made and questions asked earlier about 
diversity, but even things like that, I see so much potential 
for change, I see dynamic--I see the dynamic nature of this 
business, and I see Black entrepreneurs offering African-
American-based or-themed content, as well as non-African-
American-themed content, and just competing on a level playing 
field.
    And that is why what Mr. Morial has stated is so important 
in terms of diversity in the ranks of companies from the 
boardroom all the way down to where you started, Mr. Zucker, at 
NBC and below. But you had a very humble beginning. And so I 
believe in this country, and I believe that we can make a lot 
happen with just a little something, just like Mr. Roberts, 
your dad, Mr. Roberts, 1963, Tupelo, Mississippi.
    I imagine--I don't know anything about your dad, other than 
what he has accomplished, but I don't know whether or not he 
was a lawyer or whether or not he was a businessman, whether or 
not he was a local broadcaster, or--but I imagine that down in 
Tupelo, Mississippi, in 1993, that, you know, I imagine him 
being on the town square with an office or just talking with 
some friends about the football game getting ready to come on, 
and it is on CBS, and we can't catch it here. And we are going 
to drive to Memphis to pick it up for whatever. I don't know 
what was happening.
    But on a hot summer afternoon in Memphis, with all of the 
sand twirling, and folks just knocking around, somebody came up 
with an idea and, boom, executed the idea, and now it has blown 
up into 100,000-person or 100,000-employee company, that is a 
great American success story. And for America to compete in the 
future in this global environment, we are going to have to 
continue to produce the same humble people, small beginning, 
and they have the opportunity to do what has been done with 
Comcast, which is to turn it then over to the next generation 
for further expansion.
    And at some point, it would become too big, and it will 
start to just fall over due to its own weight. And then there 
will be some person who is there to pick up the pieces, some 
company that is there to pick up the pieces or to step over the 
carcass or the dying company, step over it and take over with a 
new operation, new attitude, new means of conveying the same 
kind of info and distributing it, maybe breaking that whole 
process up again. I don't know what is going to happen in the 
future, but I do think there is a lot of things that can be 
left to future circumstances, especially in this particular 
industry.
    It is not subject to being--should not be subject to being 
overregulated so as to stunt the ingenuity and the innovation 
that we need in order to keep this country as the top of the 
pecking order from an economic standpoint.
    But I will ask this question, Mr. Roberts. Mr. Cohen has 
issued what I would consider to be a scathing indictment, and 
the allegations of the indictment are that Comcast has made 
promises in the past. The past promises including a 2002, I 
believe, negotiation with labor, insofar as whether or not 
labor would oppose or support a merger effort by Comcast.
    And during those negotiations, it is alleged in the 
indictment, Comcast made certain representations like it has 
done on its commitments. And one of those was that the unions 
then representing the acquisition target would be left in 
place. They would not be--they would be--status quo would be 
left insofar as that relationship and the new company.
    And I know that you were not at the helm of this great 
company at that time, but would you care to offer a response to 
the comments that were made by Mr. Cohen? Or would you prefer 
to take the Fifth Amendment so that you can talk to your lawyer 
before you respond to the question?
    Mr. Roberts. Well, first of all, no Fifth Amendment. But I 
probably should consult with my lawyer. You can be my lawyer, 
because I thought to be--what you described as what makes 
America so great I could not imagine articulating any better.
    It is exactly how Comcast began. It is an idea to dream--to 
answer your question, my dad's not a lawyer. He was an 
entrepreneur, is an entrepreneur, and has tried many different 
ventures, and one day was fortunate enough to get out of the 
belt business and to get into cable TV. And I would not be 
probably sitting here today if we were doing a belt deal, but 
rather in something as vibrant and as important as 
communications and entertainment.
    So I take my responsibilities very seriously, but I always 
say thank you to my father for the wisdom of seeing the 
greatest trend that could happen, and change and not being 
afraid of it, but rather embracing it. And I think that same 
spirit, as you look at where we are at today, he feels as 
bullish about this opportunity as I do.
    It is not without its risks. You are right. I hope 
everything until you got to the carcass and somebody stepping 
over us, but that is a very real risk for any company as they 
get larger. And we have got to keep the culture--and part of 
that culture is how you treat your employees.
    So I want to, first of all, just state for the record that 
we don't believe and I don't believe that there are any 
commitments that we have made that we have not kept at the time 
of that acquisition. But let's look forward, not backwards.
    We are making commitments today. We made commitments in the 
Adelphia deal to invest in a bankrupt company, and those 
communities all have seen an upgrade since that time.
    We are making commitments in this deal that do involve 
labor commitments, and we are endeavoring to reach out to the 
principal areas where there is organized labor and to have a 
new beginning. And that is all I think you can do as you start 
out.
    It is nice to hear that NBC has enjoyed good relations, and 
we certainly want to do that which we can to maintain and 
improve on that.
    And, finally, I think the key to any enterprise is 
attracting those people who say, ``This is where I want to 
work. If I am creative, if I am a technologist, and if I am not 
necessarily in the company, I want to start my own company, I 
want to work with this company, whether you are an independent 
company or a new kid in a garage inventing that next dream that 
you have talked about.''
    And for me to do my job really well is we have to foster an 
inclusive, open culture and to try to build on the things that 
my father started that I think I have helped continue that has 
put Comcast in a position to be before you today.
    Mr. Johnson. Thank you. I have one last question. Mr. 
Roberts and Mr. Zucker, recently Americans have been glued to 
NBCU channels watching the Olympics in Vancouver. However, just 
this past July, Comcast and the United States Olympic Committee 
tried to launch a cable TV network devoted to the Olympics that 
would launch after these current Olympics.
    Now, I understand that that effort has been dropped in the 
face of objections from the International Olympic Committee. 
And I think they are planning on doing much the same thing. And 
it seems to me that this was an area where Comcast and NBCU 
were going to directly compete.
    Can you explain to us why this example does not show that, 
absent this merger, Comcast and NBCU would be actively 
competing for programming?
    Mr. Roberts. Well, the example you cite is complicated, 
because this was the United States Olympic Committee's 
initiative, and they came to seek carriage for a channel they 
wanted to start, and then they have since, as you have 
described, suspended that initiative.
    More broadly speaking, it is very competitive--anyone, 
whether it is that group or a content company, a producer, 
sporting event, there are multiple parties who get the 
opportunity to bid. That particular example, what NBC does 
today, is broadcast the Olympics. That particular channel was 
not going to broadcast the Olympics, but rather events from the 
sporting community sort of during the intervening 4 years, and 
to try to build up those sports locally and communities where 
there is not an opportunity traditionally to see those sports, 
because they are not necessarily popular except during the 
Olympics.
    So it actually wasn't trying to supplant NBC's broadcast of 
the Olympics, I don't believe. That was never stated to us. It 
was actually going to be everything but the Olympics, but 
everything about the Olympic sports.
    But in general, my answer is, we don't--events that NBC 
makes, shows that they make, like ``The Office'' or theme park 
rides or movies. Those are not things that Comcast does today. 
And so I think there is very little, if almost no overlap, and 
I think we have shown that in our statement and believe that.
    Mr. Johnson. Mr. Zucker?
    Mr. Zucker. I would concur with what Mr. Roberts said. I 
mean, the idea of that channel that had been proposed was not 
competitive with what our broadcasts were.
    And I think that is similar to what Mr. Roberts said, is 
that I think one of the great things about this coming together 
is that we really are in different businesses. And so I think 
this is complementary, and that is why I think it is so 
beneficial.
    Mr. Johnson. All right. Well, I thank you all for your 
patience and for submitting to our questions. And mercifully, I 
will yield back, but not before letting the Chairman know that 
I really appreciate his--this is a complicated area. And it has 
profound ramifications. And so I appreciate the Chairman being 
able to see that and give us time to build on certain themes 
and ask certain questions in excess of the 5 minutes that we 
normally limit ourselves to.
    Thank you.
    Mr. Conyers. Judge Louie Gohmert?
    Mr. Gohmert. Thank you, Mr. Chairman. There have been so 
many nice things said that I will skip right through all of 
those and go right to my question. With the intellects I have 
got here in front of me on the witness panel, I need to address 
my question mainly to Mr. Roberts and Mr. Zucker.
    You know, believe it or not, I have a district in which I 
have got Democrats who are friends. And they like to see a 
channel not only where they can watch the Olympics, but where 
they can find something favorable being said about the majority 
in the House and Senate. And NBC helps fill that need. And so--
-- [Laughter.]
    So, anyway, you have a combination of NBC and Comcast. And 
in my northeast part of my district, you have got potential 
Comcast competition. And the other cable providers, you know, 
they would like to provide NBC to fill that need that is out 
there.
    So how is it that there doesn't end up being some conflict 
when other cable providers want to compete with Comcast, and 
yet Comcast would be in a position to say, ``We own NBC. You 
want and need NBC. We have got quite a bargaining position with 
the conflict we have.'' How do you resolve that?
    Mr. Zucker. Yes, well, thank you for your comments, by the 
way. I think the answer to that is there are actually laws in 
place dating back to the 1992 act which would preclude Comcast 
from withholding NBC and our channels from their competitors 
and----
    Mr. Gohmert. Well, it could never be done overtly, but if a 
conflict is there, I mean, just like in Washington, you know, 
there are things people aren't supposed to do here. And lo and 
behold, they have enough pressure and power and significant 
position that they can get things done that perhaps overtly 
they are not supposed to. So how do you deal with that?
    Mr. Roberts. You know, I guess there is any--you can always 
imagine scenarios of bad behavior. You are not going away. 
Government is not going away. That has not been our history. We 
have been in the content business for more than a decade. We 
have built a successful content company, albeit small.
    Other content and distributors have been in businesses 
together. News Corp. owned DirecTV.
    Mr. Gohmert. I mean, this is not a new question.
    Mr. Roberts. It is not a new question. And history has 
shown that the market is so competitive that you can't just 
artificially change the price and imagine that the whole market 
is going to follow behind. There are too many channels. There 
is too much visibility. There is too much contention. There are 
too many independent distributors and too many independent 
programmers that we wouldn't be involved with. We are probably 
10 percent to 12 percent of the TV audience, so 90 percent, 80 
percent----
    Mr. Gohmert. Yes, but you understand, when you get in a 
very rural area, there is just not much competition. And that 
is why, you know, the relationships are so important.
    Mr. Roberts. Well, when Congress in 1992 to help address 
that issue created the satellite industry, so that every home 
in America would have at least three choices for their content, 
with DirecTV and Dish, and then in many cases now the phone 
company, and in some cases an overbuild company, such as RCN, 
it is a very different marketplace.
    But even back then, it recognized that, okay, let's--if you 
want to be in the distribution business and the content 
business, you have to agree to comply with this program access 
law, program carriage law. Back then, about 55 percent of the 
channels were owned by distributors. Today, that number is like 
15 percent.
    And the trend, as has been pointed out during this hearing, 
is to go the other direction. So we are actually not doing 
this. The motivation for this transaction is not to do that 
kind of behavior. That is not where we are going to win or 
lose.
    The motivation is, we think that with--now that there are 
more distributors and there are new technologies coming, if you 
can keep it licensed--one of the discussions has been piracy--
then I think you are going to see creation of value in content 
here and around the world.
    We also think GE wanted to sell, had lost some motivation 
to invest and we also have an economy that we believe is 
hopefully past the bottom. So there are certain fundamental 
bets that we are making, and it is not universally agreed that 
those are the right judgments, but I hope they are, that we are 
going to see these businesses grow, the economy grow, and that 
we are going to have a new dimension to our company that we 
haven't had the last 40 years.
    Mr. Gohmert. Giving an answer like that to a question that 
I ask tells me you really ought to be up here, anybody that can 
dance that effectively. But it sounds like, seriously, that 
what you are saying is, well, with the laws and, you know, with 
the competition, it sounds like it falls back on Committees in 
Congress that need to do a far better job of oversight than we 
did when Republicans were in the majority, to make sure that 
the--that the temptation to perhaps maneuver and use position 
doesn't occur.
    But I can tell you, from having been a judge for a decade, 
the longer you are in a position where you can take advantage 
of the position, the more temptations arise.
    I never ruled--I never exacted a grudge against attorneys 
who had screwed me around before I became one, but the longer 
you are in that position, as Judge Poe had verified, the longer 
you are there, the more you see opportunities. You just even 
have to be more and more diligent not to give into temptation.
    And although I am dealing with people, I am sure we would 
be very ethical and use great propriety, the longer you are in 
a position that actually could be maneuvered and manipulated, 
somebody will come along and the temptation gets great.
    So that is my concern. Thank you for your patience in 
handling it and your adeptness in dancing around it. And I will 
look forward to--and, by the way, as I think you know, I mean, 
any time you have additional information, additional things you 
can point out, we welcome those, as I am not being facetious.
    We really want to make sure things stay fair, and that 
would apply to any competitor of yours trying to misuse a 
position. We want fairness, and that is what we ought to be 
about.
    And, Mr. Chairman, I appreciate the time.
    Mr. Conyers. Judge Charles Gonzalez?
    Mr. Gonzalez. Thank you very much, Mr. Chairman.
    And I have to respond to my fellow Texan when he said 
oversight when the Republicans were in the majority. I would 
have hoped for that, and we have a lot of evidence that 
probably did not happen, but let's not get partisan here.
    Let me start off by framing my questions with some 
background in the way that I look at this. This is a particular 
merger----
    Mr. Gohmert. Will the gentleman yield? Because I want to 
make sure you didn't--I was actually being self-effacing by 
honestly saying I would hope we would have better oversight 
than we did when we were in the majority.
    Mr. Gonzalez. Well, let me--I misunderstood you----
    Mr. Gohmert. Because that was my point. We didn't do 
adequate oversight.
    Mr. Gonzalez. I apologize, because I agree with you 100 
percent. That is bipartisanship.
    Mr. Gohmert. We didn't--yes, we did not do adequate 
oversight, and so we are in agreement on that. Thank you.
    Mr. Gonzalez. I have got to play that on YouTube. But two 
things. We have the merger, which is the instant case, and we 
go case by case, and it is important. But it is very limited to 
its circumstances.
    My concern--and you could say, look, that is not what we 
are here for today--but I do believe that the rest of the 
witnesses or most of the other witnesses are here for that, 
beyond the immediate proposition or merger.
    But I am looking at it systematically and how it could 
affect--and what it sets in motion if people attempt to maybe 
mimic these particular mergers on two different, and that is, I 
understand, in the instant case, we have to make very, very 
careful and be very vigilant that what might be a legitimate 
business opportunity is really not an unfair advantage or is 
anti-competitive. And we are going to deal with that.
    But going beyond that, when I talk about public policy, 
there are two areas--and I am going to direct my questions to 
Mr. Roberts and Mr. Zucker--the first one is going to be the 
use of the public airwaves for broadcasting, what we refer to 
as really true free TV, and some people may say, ``Well, 
Charlie, that is noble of you, because you are thinking of what 
people can get free over the airwaves.'' That is part of my 
motivation.
    The other is this. I really believe this. This Committee 
and the entire Congress, the entire Federal Government, the 
only say that we really have over what goes on out there as far 
as broadcasting on the quality of the broadcasting, on decency, 
on localism, in my view, is really tied to the use of the 
public airwaves.
    Once you take that or once you diminish it, you diminish 
the ability of Members of Congress to represent their 
constituents, the American public on what they may desire. Now, 
I understand that they express all sorts of choices and when 
they select to go with cable or what, whatever, but I think 
that is an important distinction.
    The other is broadband build-out, and what does it mean in 
this particular instance, and if we continue down the road that 
we are going? So the question to Mr. Roberts and the question 
to Mr. Zucker--and this is a hypothetical, but unlike Dr. 
Cooper, I think you are going to have to accept the 
hypothetical. And the reason for it is, either it is going to 
happen or it is not going to happen, and I am talking about the 
merger.
    So I am going to read you from today's Post. Federal 
Communications Commission Chairman Julius Genachowski said 
Wednesday that the agency will recommend to Congress that 500 
megahertz of spectrum be freed up to meet the growing needs of 
mobile broadband users.
    Much of the spectrum is expected to come from broadcast 
airwaves and would be auctioned for commercial use. But 
broadcasters that own these airwaves reacted with skepticism, 
saying they need the spectrum to develop new business models 
such as mobile digital television and to serve millions of 
customers who still get news and entertainment through free, 
over-the-air broadcasting.
    Genachowski said in a speech at the New American Foundation 
that the spectrum would be culled from broadcasters on a 
voluntary basis. Broadcasters would get a cut of the auction 
proceeds.
    So the question is this: Pre-merger, you remain as you are. 
It is the nature of your enterprise, everything that goes along 
with it, remains as it is. There is no merger. How do you view 
this? Are you ready to be culled and volunteered?
    And then post-merger, the merger does go through, I want to 
see how under both scenarios your decision, your interest is 
affected in any way.
    So, Mr. Roberts, without the merger, do you really care 
about this?
    Mr. Roberts. Without the merger, we don't own any of that 
spectrum, so I don't have a position, or it is not our spectrum 
to speak for.
    Mr. Gonzalez. All right. Mr. Zucker?
    Mr. Zucker. We, obviously, respect the goal of further 
broadband deployment in this country, so I would say that we 
are in agreement with that. We also believe that the spectrum 
that we currently have is important, and we think that the goal 
of the FCC to get that further broadband deployment--we 
shouldn't be looking to the broadcast spectrum at this point in 
order to facilitate that.
    You know, there is still a considerable portion of this 
country that relies upon that spectrum to receive the over-the-
air broadcasts, and so I think that we respect both goals, we 
respect the goals of the FCC in the broadband deployment, but 
we don't know that the broadcast spectrum is the way to get 
there.
    Mr. Gonzalez. Okay, post-merger, you are now merged. Mr. 
Roberts, do you have an opinion on what the chairman of the 
FCC's proposing?
    Mr. Roberts. You know, I haven't seen today's story, I have 
to say, so, if I might, I think that I am not sure what the 
merger would do. I think the goal--and we are working with the 
FCC right now ourselves on his ``100 Squared'' initiative, how 
to get----
    Mr. Gonzalez. But would you now have a dog in that fight?
    Mr. Roberts. Yes. So I think we would say that we would 
like to be treated as all the other broadcasters, whatever that 
resolution is. We would love to be a participant in that 
conversation.
    We are very much in broadband today. We helped create 
broadband in the United States through something called DOCSIS 
cable modems. And it is a great business opportunity, in my 
opinion, to speed up for the consumer broadband adoption. And 
it is why we spent $1 billion on the next DOCSIS, called DOCSIS 
3.0.
    So I don't specifically--not a wireless expert on broadcast 
wireless. I don't know if there is other spectrum that would be 
available to be auctioned first. But I think that is a place 
where we have got to get smarter and got to have a point of 
view when a deal does close--hopefully if it closes--and we 
would like to participate in, whether it is an association of 
broadcasters or however best that communication takes place.
    Mr. Gonzalez. Now, Mr. Zucker, post merger--and I am just 
assuming that this is your----
    Mr. Zucker. Yes, I think our opinion from our perspective--
you know, that is the position that we have held. But I think 
you have to remember that all broadcast spectrum amounts to 
less than 200 megahertz. And you can't get to the 500 megahertz 
that is needed even if you killed broadcasting, which we don't 
think you should do.
    So we support the overall concept. I think this is just a 
question of how you get there.
    Mr. Gonzalez. Is that interest diminished whatsoever by the 
fact you are now merged, which someone that is more into cable 
and providing the Internet--and I understand about the 
different platforms and trying to get what--you know, on your 
telephone via Internet and so on.
    But what I am talking about is, because of the merger, you 
guys are going to be facing Sophie choices every once in a 
while? And I am just wondering, what will be the impact on 
over-the-air broadcasting, which I have said is the only nexus 
for our involvement, and secondly, building out broadband?
    Mr. Roberts. So I think that the merger is actually not the 
relevant trigger to get this conversation--this is a very 
relevant conversation with or without the merger. As you have 
pointed out, there are two scenarios.
    And that is because what is happening in wireless is 
nothing short of a revolution and an explosion of choices. And, 
you know, there are two predominant large companies that, 
whether you buy an iPhone or you get other mobile broadband 
that are not named Comcast, we are not today a wireless voice 
provider, and we are an investor in a company called Clearwire, 
trying to build a new fourth-generation wireless network.
    So we very much are hoping that there are going to be more 
and more wireless choices in the future, because it is a great 
part of what our consumers want to do, take the products out of 
their home and travel with them here and around the world, and 
multiple users, and they all want to do different things at the 
same time.
    Mr. Gonzalez. And now are you going to have content 
interests, also?
    Mr. Roberts. So one of our goals is to help, how can we 
accelerate that vision? Because that is what consumers want. I 
don't think we have that type of choice. We are spending as 
fast as we can build broadband capacity. We have got more 
wideband offered in residential homes in America than all the 
phone companies combined and, I believe, all the other cable 
companies, something called DOCSIS 3.0, which is over 50 
megabits per second. The capability to do that, that is a 
forward-looking bet.
    Mr. Gonzalez. No, and I understand what you do. We started 
off by saying voice-over-Internet protocol and all that and 
what you can do. I mean, I understand that. But what I am just 
saying is that you are not going to be the same. You are going 
to have other considerations.
    And somewhere along the way, you have to make decisions 
that obviously you wouldn't have made if you didn't have the 
interest that you are going to be acquiring as a result of the 
NBC Universal assets.
    And I am just wondering what that really has in store for 
us down the road when it does come out to build out. And I am 
talking about broadband build-out. I am not just talking about 
fiber optic and such and what goes into--I am talking about 
broadband all the way, the wireless and so on.
    When it comes to content, do you have such an advantage? 
What happens to the interest of NBC at some point? You know, 
what--if they diminish the importance of their broadcaster 
character--and I think that is incredible important, because it 
is so different from what you have in the way of cable, and I 
know NBC has cable and so on programming.
    The last question I have is simply going to be on 
competition. Now we are going to come back to the specific 
issue before us. How would this merged entity have any 
advantages as to other providers that may not have the access 
to the content that you are going to have, Mr. Roberts?
    Mr. Roberts. As I stated previously, we have today a 
carriage relationship with NBC and its channels, and six out of 
every seven channels that we carry are not owned by NBC. And I 
don't believe that our relationship with NBC is any different 
than the other major companies, based on the other distributors 
they have in the market or the other content companies who they 
compete with.
    So I actually think we are going into relatively a new 
space with, as you have pointed out, new opportunities and new 
dilemmas. And we are excited by that. We think that we can use 
that new business to change the nature, the types of people 
that work at the company to accelerate our growth, but I don't 
think it really changes the competitive dynamic for us, because 
we are about 10 percent of the programming market, and the 
other 90 percent, they have to put out great shows and they 
have to be on our competitors' platforms, or their 10 percent 
is going to go down.
    Mr. Gonzalez. And so whatever your advantage that is gained 
from this, it doesn't rise to the level of what would be an 
unfair advantage or anti-competitive?
    Mr. Roberts. That is correct.
    Mr. Gonzalez. I mean, that is what you are telling me?
    Mr. Roberts. That is correct.
    Mr. Gonzalez. Mr. Zucker, anything you want to add?
    Mr. Zucker. No, I would add--the only thing I would add is 
that it is in our interest to make sure that our programs are 
as widely distributed and seen by as many people as possible. 
So that is the way that we will recoup the tremendous 
investment that we make in entertainment, news and sports. And 
so from our perspective, we want to make sure that our programs 
are as widely distributed as possible.
    Mr. Gonzalez. And I want to thank the witnesses. And I know 
I have gone long, and I apologize to my colleagues here real 
quick, but I do want to give Dr. Cooper a few seconds, if you 
want to comment on any of the responses to the questions.
    Mr. Cooper. Well, the most interesting thing in--I am not 
sure it was this question or the previous question, but earlier 
in the testimony, Mr. Roberts said that the Xbox competes with 
Comcast. He then said that Comcast regional sports network does 
not compete with NBC Sports.
    That doesn't make any sense. These two people sell products 
that compete with each other. And that is a fundamental 
observation.
    It seems to me that you also said that the nexus for this 
Committee is spectrum. Actually, if this were the Commerce 
Committee, that would be the nexus. But in this Committee, it 
is the Sherman Act and the Clayton Act.
    And the analysis that you have to do is look at the 
products and see if they compete. The most recent study from 
Nielsen says that 98 percent of the TV viewed in America is 
viewed over the traditional delivery mechanism, cable, 
satellite and broadcast.
    So this notion that the Internet had radically changed the 
marketplace is simply wrong. Now, it could, and that is why NBC 
invested in Hulu. And it is that competitive threat that going 
forward we really have to preserve.
    Mr. Gonzalez. Thank you very much.
    I yield back. Thank you, Mr. Chairman.
    Mr. Conyers. Judge Ted Poe?
    Mr. Poe. Thank you, Mr. Chairman. I feel like the Lone 
Ranger down here. You know, it seems like it has all been said, 
but not everybody has said it, so it is my turn.
    And I wish Judge Gohmert was here, because he kept saying, 
as my friend, Judge Poe, knows about being on the bench too 
long, you could be influenced, so I served 22 years on the 
bench, twice as long as Mr. Gohmert, so I think he was 
offending me when he made that comment.
    I am a big believer in television. I mean, I am so old, I 
remember our first black-and-white TV. My kids don't even 
understand that there was such a critter. They don't.
    And, you know, but I don't watch TV much. If it is not on 
the History Channel or the Discovery Channel or American Movie 
Classics, I am probably not watching it.
    But as a judge, I was the first judge in Texas criminal 
courts to allow an entire criminal trial to be televised on 
live TV, introduced legislation to let the nine Supremes down 
there have their Supreme Court open to the public so we can see 
what they are doing. We will see if that ever gets anyplace, 
Mr. Chairman, within this Committee.
    But I am a believer in competition. Competition makes for 
better products, and the consumer generally wins on 
competition. That is my philosophy, across the board, sort of a 
free-market guy.
    And when you don't see competition, you see problems. And 
there are a lot of anecdotal issues that we could talk about. 
But to just give you one--and not picking on Comcast, but just 
give you: Comcast is the only folks in town in part of my 
district. If you want to watch television, you are on Comcast, 
or you have to have rabbit ears.
    And tomorrow, one of my constituents will have in the last 
18 months the 77th visit by Comcast to come out and try to fix 
the cable problem. They can't get satellite, because they are 
on the wrong side of the--you know, of the sun. And they work 
from their home. And so they have got to have Internet, and 
they have got to have TV service, and that is the only way they 
can get it. So Comcast has no competitor with this constituent.
    Anyway, so I believe that we ought to promote this, the 
competition. And I am concerned--I hadn't made up my mind on 
this legislation. I am still open-minded about it. But the 
concept of being able to deliver the service and have the 
content of the service controlled by the same folks concerns me 
a great deal.
    So my question to you--and this is my only question, Mr. 
Chairman--to each of you, including the three silent ones for 
the last hour, do you believe that this deal will promote 
competition where the consumer will eventually win out?
    Mr. Roberts?
    Mr. Roberts. I appreciate that, and I am sorry about that 
customer. And if I might, I would like to see why there have 
been so many visits. That is not how we like to do business.
    Mr. Poe. Well, they have been out there that many times----
    Mr. Roberts. Well, that may be true, but that is not 
acceptable. I believe this is pro-competitive, because we are 
going to innovate as a company, we are going to make better 
programming for NBC and Universal. We are going to try to 
accelerate how it is used by technology.
    The consumer's time--what I am referring to and what is 
being competed with from the Internet and from Xbox and from 
iPhones and from television. And as you pointed out, not 
everybody watches TV like they have in the past, and the world 
is changing at a breathtaking speed.
    So we are at a crossroads in time. And our company is 
wanting to invest in advertisers, having more ways to reach 
their message than ever before. Again, it has been said, oh, 
this will reduce the way for advertisers. I don't believe that. 
I believe you have a company, one of the great brands and 
assets in America in history of television, NBC, and it is now 
in fourth place, and it is not what it once was.
    So it is not a risk-free decision on our part to want to 
come in and try to make it much greater, invest in it, and I 
think that that is all about competition, because they have 
more competitors than they have ever had as the technology has 
changed, and I think that there are more technologies coming 
that we can't envision. As Jeff has said, in the next 5, 10 
years, there will be more change again.
    And I think this is building America and sold all over the 
world, and we are looking forward to trying to transform our 
company with that kind of innovation.
    Mr. Zucker. I believe it is a fiercely competitive world, 
and this doesn't change that at all. The fact is, with this 
combination of assets, we will still reach less than 11 percent 
of all television viewing on a daily basis, so vibrant 
competition is really the hallmark of what we do in our 
business.
    On the Internet, where there is so much attention, 
programming on the Internet is even more competitive. The fact 
is, today, NBC Universal has 1.6 percent of all viewing on the 
Internet. With this, we would move to 2.2 percent.
    So no one, in fact, has more than 5 percent, other than 
Google. So I think that the competitive dynamic remains 
fiercely alive even with this.
    Ms. Prewitt. I think we believe that this merger creates 
and bolsters the power of two gatekeepers who determine what 
content will actually flow through the major pipelines that 
come to the consumer's home. We think that conditions that 
protect competition both at the NBC level and at the Comcast 
level can make that problem come right.
    And if the merger is properly conditioned, we would hope to 
share in their vision of a vibrant distribution infrastructure 
within the United States. But without those conditions, what we 
see is a vision in which no one else can be a part, except 
these two companies. Thank you.
    Mr. Cooper. In my testimony, I identified three areas where 
it directly reduces horizontal or head-to-head competition, 
local TV markets, multi-channel video content market, and the 
Internet, where they both distribute content.
    I also identified two areas where vertical leverage can be 
used to undermine horizontal competition. That is in program 
access and cable carriage. And they identify a sixth factor, 
which is the illegal tie and the market division scheme between 
cable and Internet. For those reasons, I believe it will 
significantly reduce competition.
    Mr. Poe. Thank you, Dr. Cooper.
    Mr. Cohen. Yes, I would echo that. My frame here was, most 
consumers are also workers. And the consequences about 
employment both internally and the combined companies, huge 
employers, and also externally, in terms of the competition and 
investment.
    And we believe that as it is structured now, it would 
impede investment and investment particularly in high-speed 
connections, fiber connections to the house, like in your 
district, at least the parts of it that are rural. It won't 
encourage that competition because of what we earlier 
discussed, bulk pricing that is bundled up when a potential 
competitor decides, do we invest or not?
    I would agree with Mr. Roberts that their own investment in 
DOCSIS 3.0 is a positive and that we all need to encourage 
investment in high-speed connections to houses across this 
country, and we need to look at the impact of these kinds of 
decisions not only on competition, which is at the core here, 
but also in terms of investment and jobs and where the U.S. is 
in the global economy.
    And it is in that realm that we believe that this bundling 
vertical integration of content and the pipe or the network 
will impede that investment and that that investment by others 
is already slowing dramatically.
    Mr. Schwartzman. In my written testimony, I explained why I 
believe existing law is insufficient to address the anti-
competitive consequences of this transaction with respect to 
availability in the video programming market and how it 
increases costs to competing satellite and cable providers, 
increases their programming costs in an anti-competitive way.
    But I would like to focus my remarks here on what has not 
been to my mind sufficiently discussed during the course of 
today's hearing, and that is the impact on the nascent Internet 
distribution markets, TV Everywhere model, which Comcast 
employs.
    The entrepreneurs that Mr. Johnson was asking about, the 
wireless providers that Mr. Gonzalez was asking about, new 
forms of competition, new programmers who want to reach their 
customers by the Internet face barriers by having a system 
advanced by Comcast that locks in the existing video 
subscription model and would make it impossible for somebody 
using the Clearwire system that Mr. Roberts talked about to 
deliver video programming unless they were also a video 
subscriber to Comcast.
    It is a geographic tie-in, because Comcast will not offer 
its TV service outside of Comcast's franchised cable television 
areas, even though from a technological standpoint, it can 
offer it throughout the United States. And it is a profoundly 
anti-democratic model, which would allow Comcast in the absence 
of network neutrality regulation to take the entrepreneurs that 
Mr. Johnson was asking about and charge them more for Internet 
access to upload than a large competitor or the NBC content 
which was competing with this new entrepreneur.
    So for all these reasons, I believe that the proposed 
transaction is profoundly anti-competitive, will leverage 
existing anti-competitive conditions in cable to a far greater 
extent. Thank you.
    Mr. Poe. Thank you, all of you, for being here so long.
    Thank you for your patience, Mr. Chairman. I yield back the 
remainder of my time.
    Mr. Conyers. I am very pleased now to call our last 
witness, who has been very constant with this Committee on a 
number of subjects, Luis Gutierrez of Illinois.
    Mr. Gutierrez. Thank you, Mr. Chairman.
    Well, you have had a long day here, so I will try to keep 
it brief. I want to say, first of all, that I had a wonderful 
meeting yesterday, Mr. Zucker, with Paula Madison and other 
people from your group, your attorney and others, your general 
counsel. I think it was a very productive meeting, and so I 
thank them. I know some of them are here. It was a productive 
meeting, and we got a lot of things discussed there.
    I want to say that I did fly out with my wife out on the 
1st of February to be at the L.A. Federation of Labor. And I 
had to tell you, Mr. Cohen, you inspired me that day. Thank you 
so much for your commitment to the rights of working men and 
women.
    I was there for your entire presentation and those of 
your--obviously, of your membership. And I will tell you, I 
came back and told them, ``Let's get that card check,'' which 
is, I think, the best and most viable way we can help you as 
companies such as NBC and GE and others merge or continue to 
grow and expand in America.
    And I say that because, although I heard Mr. Roberts say he 
is going to keep the spirit of the union contracts and union 
spirit at NBC, when NBC bought Telemundo, the on-air personnel 
were not allowed immediately to gain the same access to the 
same union that the NBC staff did.
    And it was a long wait and a long struggle, I have to say, 
but we had to discuss with them, especially the contracts of 
many of the on-air, because they were brought in from different 
countries, and so they had immigration issues. They didn't use 
any of those issues, but we have to make sure they didn't.
    And in the end, the workers voted by one vote. But I just 
never knew, since there were 21 people employed and 21 had 
signed saying they wanted a union--I didn't know what we needed 
an election for. But even after the election, we won, and it 
just shows the spirit.
    So I want to thank you. Keep up--and I know we have our 
work to do here in the Congress of the United States.
    I want to say to Mr. Roberts and Mr. Zucker, so I have two 
daughters. I have Mita. She is 30, grandson, Lucito. And I have 
Jessica, who is a senior in college, graduating this year. I 
imagine you guys, if you don't have daughters, you have wives, 
you have mothers, you have sisters.
    And so I bring this issue up to you because--and I 
discussed this yesterday with the folks from NBC, and I want to 
bring it up again to both of you. And that is the treatment of 
women particularly on Telemundo, what could only be described 
as one of the most misogynist portrayals of women that is on 
TV.
    I do not believe that you would allow on NBC or any program 
created by Comcast to have the same depiction of women on NBC 
as you do on Telemundo, whether it is in your regular 
broadcasting or on your news cycle.
    There is a great and huge problem in the Latino community, 
one of which is the relationship between men and women. We can 
say it is an ageless problem. But it is a particular problem of 
violence which exists in our community.
    And part of it is the correlation of power between men and 
women and how men and women are viewed and looked at. I 
remember, as I grew up, watching ``Leave it to Beaver,'' 
``Father Knows Best.'' I wanted my father to be like them. 
Although I had a great dad, unfortunately, that is what TV 
taught me, right?
    You know, I didn't like my coarse hair. You know, I wanted 
to be like them, because that is what TV taught me. It taught 
me that what I looked like and what I represented and what I 
was wasn't of great value. It wasn't portrayed on TV as 
anything of value. I never saw it. So I wanted to be, in spite 
of all of the things about immigrants and not wanting to be 
American, I wanted to be nothing more than American. And TV 
taught me I wasn't.
    So I want to go back to the issue of women. And I just want 
to say to you, take a moment--Mr. Zucker and Mr. Roberts--take 
a moment. You are going to buy NBC. You should know about 
Telemundo. You should know. And I am particular--and let me 
tell you, there are a lot of great people on the newscasts 
there that do a lot of great work.
    But I am going to tell you something: Something has to be 
done fundamentally about the program specifically as it relates 
to women. It does not help a community advance forward when one 
of their major avenues of information is viewed.
    And don't only look at it. Look at the newscasts and 
compare the newscasts on MSNBC, the newscasts on NBC, portray 
how women are dressed, how they are viewed, the desks they sit 
behind. Just portray them in their complete context and then 
see how they are seen on NBC.
    There would be outrage in this country if you were to take 
the same and portray it on--it just wouldn't happen in this 
country. I don't believe it would, not on all the news, not on 
all the news, but on some of it.
    And there is enough of it to say--I just came back. There 
was a study. I just came back from spending some time with my 
mom in Puerto Rico, and I just got back last week, and there 
was a study that was issued. Even in Puerto Rico, 10th country 
in the world of men killing women, of husbands killing wives, 
10th country in the world, 4 million people.
    Now, that is nothing to be proud of. We are 10th in the 
whole world? I am not trying to say TV is the only thing, but, 
you know, it is part of the vicious cycle that we have, and it 
is a powerful component for changing how people view the world.
    I came back on that airplane, coming back, and I watched 
the program not on NBC, and it was amazing. Here was this 
senator running for President whose brother was gay, and he was 
engaging his fiancee whose brother was gay, and they were 
returning to the veteran that came back from Iraq, right? And 
how these two gay men were portrayed in that series I think 
does a lot for ending bigotry and hatefulness in how people 
view one another. And I think TV and how people are portrayed 
is very, very powerful.
    I don't think that you would--that it would be allowable if 
you were to take women and substitute them for Black people, 
substitute them for Jews, substitute them for any other group, 
that it would be acceptable for Telemundo to do that.
    And secondly, look at how it is you look at the gay 
community on your Spanish-language network, both in terms of 
the jokes, in terms of the nuances, things that, I tell you, 
you know, I don't believe would be acceptable in a broader 
range, because I think I know where America is going and where 
the programming is going, in terms of this country.
    So I would ask both of you to just speak to that issue a 
moment and to--look, just to say, yes, Luis, tell you what, I 
am going to take a look at it, as a dad, as a father, as a son, 
I am going to take a look at it and, as a human being and as a 
man with power, to kind of change that equation. I guess that 
is what I would like both of you to speak to.
    Mr. Zucker. So, Congressman, Paula Madison, Rick Cotton 
filled me on your conversation yesterday, and they were 
grateful to hear from you on that, and I would echo the same 
today, which is that I appreciate your comments. We are very 
proud of Telemundo, but I will give you my word here today that 
I will go back to the executive team at Telemundo, which 
includes some very prominent women in that executive team, and 
I will discuss it with the executive team to make sure that 
your comments are passed along.
    Mr. Gutierrez. Yes, and take the powerful women at NBC and 
let them help the powerful women at Telemundo get together and 
have that kind of power, you know, that they already have 
within the corporate structure and convey that to them, if you 
will.
    Mr. Roberts?
    Mr. Roberts. I am pleased to hear what he just said. I will 
do the same. I will go back, as you suggested, and watch----
    Mr. Gutierrez. Watch it.
    Mr. Roberts. Yes.
    Mr. Gutierrez. Watch it. But watch--tell them to put 
together--and you will see what I mean, and you will say, 
``Maybe Luis has something here.'' And if you watch it day in 
and day out, you are really, really going to have a sense.
    Let me go to Mr. Roberts. So you have about 100,000 
employees. And I understand about 8 percent of them are Latino, 
is that correct? That is the information that I have been 
given.
    Mr. Roberts. I don't have that stat--okay.
    Mr. Gutierrez. And it is from your folks. So Latinos 
constitute about 15 to 16 and ever growing part of the 
population. So why is there such a disconnect between the 
number of Latinos employed at Comcast, a company which much 
to--we have heard from our friends from Texas from the rural 
area, it is the only cable company--and one which I have sent 
lots of checks to over the year, I assure you, to Comcast, you 
can go check, always on time. You know, direct payment makes 
for a good payment, because my bank--they are very good at 
sending you the money on the appropriate date you demand it.
    So as a customer and somebody who has a many, many year 
relationship with Comcast, why not? Why not? We have got a 
large urban city like Chicago, L.A. It is easy, and they are 
easy to find. And if you can't find them, I will tell you 
something. You call together your public relations folk, go to 
any one of those schools, they are going to show up for jobs at 
Comcast.
    So why such a disconnect between--and I assure you that if 
you were to take their proportion--I am using general 
population. That is 16 percent of the general population. If I 
were to take the kinds of jobs that exist at Comcast--that is, 
the people that drive the cars and the--you will see we are 
even higher participation rate. And that spectrum or that 
portion of the job of the economy, we are even greater in that 
area. So why such a disconnect?
    Mr. Roberts. First of all, let me go back and look at that 
specific number. I am not familiar that--I hope that is the 
right number. And if it is not, I will write to you or come 
visit.
    Mr. Gutierrez. Well, come visit, but I would like to talk 
to you about it, because, you know, Comcast has a huge presence 
in Chicago. Through the agreement it has through the city of 
Chicago, it is my cable company. I don't have a choice. They 
made an agreement with the city of Chicago. And if I live where 
I live, Comcast is my provider.
    Mr. Roberts. We have been making a lot--I agree. There is 
no disagreement. I mean, we want our employees and our channels 
to represent our customers, and that is great business. I am 
pleased--I don't know if you were here earlier when I said 
that----
    Mr. Gutierrez. I was.
    Mr. Roberts [continuing]. Top 60 companies Hispanics, you 
know, for 4 years--5 years in a row by Hispanic Business 
magazine, we have been recognized. We have our Web site in 
Spanish. We have all sorts of more programming. As we are going 
from analog to digital, a lot of our initiative, are to both 
English-speaking and Spanish-speaking programming and to 
broaden----
    Mr. Gutierrez. And, Mr. Roberts, you have great people in 
Chicago. I mean, there is a--you have a Latino population of 
workers there that are wonderful. I call upon them all the 
time. Wonderful workers, they show up early, they stay late. 
They would be a credit to the company.
    Mr. Roberts [continuing]. Accelerate that.
    Mr. Gutierrez. It is just you hire insufficient numbers of 
them in relationship to our purchasing power. I mean, I am not 
asking you to give us something for nothing. I don't know how 
many Latinos purchase Comcast, right, how many of your viewers, 
but I would--I believe, understanding a little bit of my 
community and having grown up and never, you know, gone to 
college, and I didn't move from the neighborhood, I stayed in 
the same neighborhood, right, having that connection and that 
nexus to that community a lot.
    Because I will tell you something, I can't figure out a 
person in my neighborhood that I visit that doesn't have a 
Comcast box. So I can only assume and extrapolate from that 
that you are doing very, very, very well in the Latino 
community.
    So all I am saying is, yes, look at the numbers. If you 
find that they are correct and that they are insufficient, then 
tell me, because I know there is going to be a grand meeting, 
right, for everybody to get together and kind of say, you know, 
how are we going to all get along and sing, you know, 
``Kumbaya'' together.
    But, listen, seriously, 8 percent, 16 percent. It is only 
half. It is even greater if you look at that particular sector 
of the labor force. You are going to find it is very 
disproportionate. There should be a reason why it is happening, 
and then it terms of other numbers.
    And I will say one other thing. I know what, you know, 
Hispanic magazine and others, and the Chamber of Commerce and 
others, have to say about you. I am sure they are right, and I 
am sure they had good reason for extolling those virtues of 
Comcast. But you have 13 members of your board of directors. 
You couldn't find one Gonzalez, Rodriguez, Martinez, of any 
competence, of any significance to be on the board of directors 
of Comcast in the year 2010? Why not? Why isn't there one?
    Mr. Roberts. There is not a good answer to that. And as I 
said earlier, it is a major priority for our board, and I hope 
not to be before you again where we don't have an answer to 
that.
    Mr. Gutierrez. And it shouldn't be. And, look--and it is 
not only just finding somebody, because you will find somebody, 
but finding somebody who is going to go and challenge, who is 
going to go and challenge and make sure that you become a 
stronger, more vibrant company.
    It is my opinion that in America, the companies that are 
going to move forward, that are going to advance, that are 
going to prosper are those that have a connection to the 
communities that they serve. And the connection to the 
communities that they serve are going to come through the 
people on the front lines that speak to that community.
    You will not know how angry it makes people feel that when 
they call somebody on the phone and they go, you know, for 
English press one, and then they go, ``Para espanol, oprima el 
dos.'' I mean, it sounds like my Spanish teacher, you know, 
from freshman year.
    You know, we want our people speaking our language to our 
people, not others doing that, because what you are saying is 
that you couldn't find anyone from our community, but someone 
who went to college and was smart enough to take Spanish as a 
second language and put them on.
    That is going to be very critical and very important, I 
think, to your success. So if I were given--which is what I am 
doing--given you--hire them. It is going to be good for the 
bottom line. In the end, you are going to be richer and make 
more money and be more profitable because they are going to 
bring you ideas and they are going to bring you energy that you 
do not receive because of our life experience.
    It is going to happen. So don't have it, and don't do 
like--let me see. I will give you an example. Don't do like my 
friends at Verizon. They put a Latino on their board from 
Puerto Rico, and Verizon shut down its operation in Puerto 
Rico. I was like, how could this be? So it is not the fact of 
simply having one, but having one that is going--that has a 
stake, that has an interest to carry forward.
    Thank you all very much. I know you have had a long day 
here. Thank you so much for listening.
    Mr. Roberts. Thank you.
    Mr. Conyers. Our last witness, Judy Chu.
    Ms. Chu. Congratulations on your stamina. Well, I did want 
to take this time to ask about a few issues. One is on the 
retransmission issue.
    We are seeing an increasing number of instances in which 
retransmission, consent negotiations are breaking down, leaving 
consumers at risk of losing access to broadcast television 
service. Even when these negotiations are resolved without an 
actual disruption of service, the uncertainty is certainly 
disruptive to consumers, in terms of what finally happens.
    For instance, when FOX threatened to pull their premium 
content during the holidays, people, of course, would have 
missed the Super Bowl. And as a result, there would not have 
been that content to certain cable providers.
    With your merger, you would be at an advantage over other 
providers in terms of being able to negotiate and to not have 
this disruption in service. In your view, is there a need to 
adopt reforms to the transmission consent process established 
by Congress in order to protect consumers?
    Mr. Roberts. I think the first point that you made, where 
FOX and Time Warner, was very high-profile, and some of the 
points you have made, we have traditionally also made, which 
is, this is very compelling content, like the Super Bowl, and 
is this the right process?
    I think any review of that should be across the entire 
industry, because no matter what happens with this situation, 
there are several other networks at 80 percent, 90 percent of 
the viewing, 75 percent of the distributors. There is going to 
be this conversation of retransmission consent. This has been a 
longstanding set of changes in the marketplace.
    What I believe is that by now, we will still be 80 percent 
a cable company in terms of cash flow after this transaction, 
approximately 20 percent a content company. I think it allows 
us to have a role, to help come up with constructive solutions 
of how--for the industry, how should this get resolved in the 
future?
    There is no easy answer. I think it would have been before 
you or would have happened at the FCC already. And I think it 
is an ongoing conversation.
    At some level, the cable companies now view us as a 
broadcaster. The broadcasters view us as a cable company. So in 
some respects, those conversations still have to take place 
without us, but we may have an opportunity to play a unique 
role.
    One of the things to your other--I believe inside your 
question is specifically with NBC, will we treat others in a 
way that would create some harm potentially? So one of the 
first conditions we made after saying we continue to want to 
broadcast and will commit to broadcast NBC free over the 
airwaves is to have the program access rules, which heretofore 
have not applied to retransmission consent negotiations, apply 
to retransmission consent negotiations.
    So another distributor like DirecTV knows they are going to 
have the same access to NBC that they do to CNBC in the future 
with the FCC having a role, if there is a problem there.
    But I think, more importantly, frankly, is, what about all 
the other negotiations in the industry? And it may well be 
something that you are hearing more and more about because the 
stakes are so large.
    Ms. Chu. Okay. Then I wanted to follow up on some of the 
questions that were about piracy. I do represent a district in 
L.A. County, and I have spent a lot of time talking to folks in 
my district and in Los Angeles to folks in Los Angeles during 
the recent congressional district about this issue.
    And I learned that, in 2005, piracy costs the city of Los 
Angeles about 106,000 jobs, with wages of $5.1 billion, so this 
is an extremely serious issue.
    So I wanted to ask about the balance, about the balance 
between making sure that there is the protection of 
intellectual property rights, which we certainly hope that you 
can do, but also, balancing that with net neutrality and the 
open Internet. How do you balance the two?
    Mr. Roberts. Well, I think that we--again, it is a little 
bit like retransmission. These are tough issues. Earlier, we 
were talking about how fast the technology is changing, both 
for the pirates and for the capabilities for the consumer to 
take advantage of these technology changes in a legal way.
    And one of the real opportunities for this new company is 
to play a leadership role in trying to crack down on the piracy 
to keep the model legitimate, because so many parts of the 
ecosystem depend on that, and the statistics you have cited 
just for California are stunning. And over the world, it 
magnifies many, many times.
    So heretofore, we have been looking at it as solely a 
distributor, and now we have made a large investment in 
content, so it accelerates our desire to find good 
technological solutions.
    One of the other points is that people try not to use this 
as a competitive advantage, where some networks you can get 
pirated content, and other networks are policing and enforcing 
in a way that reduces that likelihood and that you are 
criticized for that behavior.
    So industry-wide solutions are, in my opinion--again, this 
merger does nothing but to help foster our desire to try to 
help play a role in those industry-wide solutions.
    Ms. Chu. And how about the issue of maintaining net 
neutrality?
    Mr. Roberts. Well, you know, net neutrality means different 
things to different people. We have always been for an open 
Internet and a free Internet. We helped invent broadband in 
this country with cable modems and DOCSIS. And we have invested 
billions of dollars. And as I said, we are now moving on to 
DOCSIS 3.0 and even faster Internet.
    There has been very few allegations--it is a very vocal 
community. When somebody does something that somebody's upset 
about, it gets a lot of attention very quickly and tends to 
change behavior quickly. And the FCC, again, industry-wide--I 
don't think this merger, frankly, affects Comcast's behavior as 
a cable company, as it affects its broadband. NBC doesn't 
deliver ISP services.
    So the question is, as the FCC reviews net neutrality, we 
are an active participant. It is a very open and fair process, 
very transparent that Chairman Genachowski has been having. 
And, you know, we are involved. We may have a difference of 
opinions as to what the definition, where it should start and 
stop.
    But, frankly, it is critical to our future to have 
broadband continue to grow and be successful, and consumers 
have to feel comfortable both with their provider and with 
their access to information from the Internet. And I think, so 
far, it is the engine of a lot of growth, and I hope it will be 
so in the future.
    Ms. Chu. Okay. And then, finally, there has been some 
reference to Hulu. I just wanted to know, what is your 
relationship with Hulu? And do you see them as a competitor? Do 
you share content with them? And how do you see that 
relationship changing with the merger?
    Mr. Roberts. NBC Universal owns 32 percent non-controlling 
interest in Hulu. There are other companies, FOX, Disney, 
Providence Equity that own the balance, I guess, in addition to 
management.
    I don't view us competing with Hulu. They are an ad-
supported service today. There is so much explosionit is such a 
nascent market. There is a lot of experimentation, innovation 
happening on video with the 'net. What is the business of Hulu 
and others who provide it? Comcast today, about 40 percent of 
our video views of professional content come from Hulu, so we 
are distributing. People can access Hulu through our portal.
    We are about 3 percent of Hulu's views, so we are a very 
small part of Hulu's eco-world. And together, NBC and Comcast 
are about 2.5 percent of professional video content.
    Google, YouTube, over 50 percent of the 30 billion video 
views, Apple, Netflix, it is a nascent market. And many people 
are trying to figure out how to participate, how to grow, how 
to find things that consumers want and a great business model.
    So personally, it is an exciting new area. We don't come in 
with any agenda other than to help try to make it grow. And, 
you know, something we will learn about once we are together, 
but I have never actually met the people at Hulu. I have talked 
to them on the telephone, but looking forward to learning about 
their business.
    Ms. Chu. Okay, thank you.
    Mr. Conyers. This has been a very important hearing. We 
will leave the record open for any of the witnesses that may 
want to submit any additional comments or supplementary 
statements. I particularly thank my staff for working for many 
weeks on pulling this together. There will undoubtedly be 
future public discussions about this matter.
    And I thank all of you very much for your honest and 
thoughtful contributions.
    The Committee stands adjourned.
    [Whereupon, at 3:11 p.m., the Committee was adjourned.]


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