updated 12/23/2010 5:29:56 PM ET 2010-12-23T22:29:56

The head of the Federal Communications Commission is proposing regulatory conditions to ensure that cable giant Comcast Corp. cannot stifle video competition once it takes control of NBC Universal.

The conditions are intended to guarantee that satellite companies, phone companies and other traditional subscription television services can still get access to marquee NBC programming once the transaction closes. FCC Chairman Julius Genachowski also wants to ensure that new Internet video distributors can get the programming they need to grow and compete.

FCC officials, however, wouldn't disclose the specific conditions Thursday. Genachowski needs at least two of the other four commissioners to back his proposal, and he is likely to make modifications to win the support needed to cap off the yearlong regulatory review.

Comcast is seeking government approval to buy a 51 percent stake in NBC Universal from General Electric Co. for $13.8 billion in cash and assets. The deal would create a media powerhouse that both produces and distributes content.

( is a joint venture of Microsoft and NBC Universal.)

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The deal is also still awaiting approval by the Justice Department, which will attach its own conditions. Those are likely to be similar to the final conditions imposed by the FCC.

Approval with conditions is expected early next year.

Comcast suggested that it could accept what it believes to be in Genachowski's proposal. In a statement, the company said the proposal would ensure that the deal delivers "real public interest benefits" and "enable us to operate the NBC Universal and legacy Comcast businesses in an appropriate way."

The combination would give the nation's largest cable TV company control over the NBC and Telemundo broadcast networks; 26 local TV stations; popular cable channels including CNBC, Bravo and Oxygen; the Universal Pictures movie studio and theme parks; and a stake in, which distributes NBC and other broadcast programming online.

Although the FCC didn't disclose details of Genachowski's proposal, one measure that has been under consideration would try to guarantee that satellite operators, phone companies and rival cable companies can still get access to NBC broadcast and cable channels, Comcast's regional sports networks and other marquee programming at reasonable prices.

That condition would mandate arbitration to settle any disputes and would potentially prohibit Comcast from withholding content during negotiations.

Another condition that has been under consideration would require Comcast to abide by the FCC's existing "program access" rules in dealing with online video distributors. Those rules require cable companies to make programming they own available to rivals such as satellite companies, but right now they do not apply to Internet distributors.

By extending these obligations to Web distributors under certain circumstances, such a condition could prevent Comcast from stifling the growth of the nascent Internet video market, which could eat into Comcast's core cable operations if enough consumers drop their cable subscriptions in favor of low-cost online alternatives. Such a condition would be a setback for Comcast, which had argued that the online video market is still too young for such mandates.

Genachowski's proposal would also require Comcast to continue offering an affordable, standalone broadband option for customers who want Internet access but not cable. This condition, too, could help drive the growth of online video by allowing consumers to cancel their cable subscriptions without losing their Internet connections.

The chairman's proposal would also bar Comcast from interfering with online traffic that travels over its systems, including Internet video from online services such as Apple's iTunes.

Comcast already owns a handful of cable channels, including E! Entertainment, Versus and the Golf Channel. It also has a controlling interest in the Philadelphia 76ers and Flyers, and its SportsNet Philadelphia channel carries Flyers, Phillies and Sixers games.

But for the most part, Comcast has built its business on distributing video programming and providing Internet connections. The company has about 23 million video subscribers and nearly 17 million broadband subscribers. Taking over NBC Universal would transform it into a media giant too — giving Comcast control over major box office releases and a wide range of popular television programming.

Comcast is contributing assets worth $7.25 billion to NBC Universal and paying General Electric Co. $6.5 billion in cash for the majority stake.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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