An FCC Rule Could Hinder An NBC-CBS Merger

Dec 21, 2023

By Ted Hearn, Editor of Policyband

Washington, D.C., Dec. 21, 2023 – CBS parent Paramount Global is reportedly in merger talks with Warner Bros. Discovery – in yet another sign that legacy media institutions continue their search for sufficient scale to compete with Netflix, Apple, and Amazon in the streaming video space.

If CBS is in play, that could draw others into a bidding contest, including Comcast, according to a CNBC report.

If Comcast came away the winner, the Philadelphia-based media conglomerate would own the NBC and CBS networks. Federal Communications Commission rules do not permit the common ownership of two Big Four broadcast networks without a wavier – a restriction that dates to 1946.

The FCC’s “Dual Network” rule is under review, along with other broadcast ownership rules that have been the subject of intense industry lobbying at the FCC in recent weeks. The agency is under a court order to complete its review by Dec. 27.

The FCC relaxed the Dual Network rule in 2001 to permit one Big Four network to own, operate, maintain or control the UPN and/or the WB television network. TV station owner Nexstar Media Group today owns 75% of the CW Network (the successor network to the UPN and WB networks). Warner Bros. Discovery and Paramount Global each own 12.5% of the CW.

Earlier in the month, a top Comcast official gave no indication the company was looking to make a deal.

Speaking at the UBS Global Media and Communications Conference on Dec. 4, Comcast President Mike Cavanagh said the company needed a “strong and compelling reason” to think about entering the merger market.

“Our job is to always look at things, but all I can say is that the bar is really high because I really like the organic hand we have against all the businesses that are the growth businesses that we have,” Cavanaugh said. “We don’t need to do anything …”