It's now been about two weeks
since we learnedof the possibility of a merger between
Comcast (Nasdaq: CMCSA), the nation's largest
cable operator, and
General Electric 's (NYSE: GE) NBC
Universal.
It's impossible to know how much longer we'll have to wait
for a decision on the deal. And while there are definitely
potential benefits for both companies, I'd suggest that in
the meantime we consider the advantages that Comcast could
reap should the merger prove successful.
First, however, let me take issue with a recent
BusinessWeekarticle essentially contending that Wall
Street analysts are universally opposed to combining content
-- that's movies and TV shows -- with the cable, satellite,
or internet means of distribution. As a former media analyst
who covered Comcast and its peers, it's my belief that
combining these two parts could actually benefit a number of
aspects of the entire video experience. I felt the same way
when Comcast courted
Disney (NYSE: DIS) five years ago.
Beyond that, one of the intriguing elements of this
potential marriage is that it's relatively easy to identify
several benefits that would accrue to Comcast, which would
take a 51% stake of the operation:
Verizon (NYSE: VZ),
AT&T (NYSE: T), and
DirecTV (Nasdaq: DTV), would have more
meaningful benefits for its potential customers.
NBC's content and its partial ownership -- along with
News Corp. (Nasdaq: NWSA) -- of the Hulu
online video service would provide Comcast with an
increased ability to offer robust programming over the
Net.
There are plenty of other angles to this deal, and its
conclusion isn't guaranteed. As such, with Comcast's video
numbers sliding, I'd watch the action, but not yet place buy
orders on the cable giant.
Comcast has been rated a two-star company by
Motley Fool's
CAPSplayers. Why not weigh in with your assessment
of the
companyand the possible merger?
This article was originally published as
Comcast and NBC: A Match Made in Heaven?on
Fool.com
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