Matt Daneman

With AT&T's planned DirecTV Now service a driver of its buy of Time Warner (see 1610240011), NBCUniversal CEO Stephen Burke questioned the likelihood it and other over-the-top entrants will siphon off significant numbers of traditional pay-TV subscribers. "Most people find tremendous value in their cable or satellite subscription and are not going to change," he said during the cable operator company's Q3 earnings call Wednesday. He also said it's unlikely such services would materially benefit NBCU at least in the first couple of years by delivering major numbers of cord-cutters and cord-nevers. Comcast executives said they wouldn't comment on the AT&T/TW deal itself. CEO Brian Roberts said Comcast is targeting mid-2017 for rolling out a wireless service as part of a multiproduct bundle. For the quarter, revenue was $21.3 billion, up 14.2 percent year over year, and it added 432,000 video customers vs. a 48,000 decline the same quarter a year earlier. The cable ISP said it added 330,000 broadband customers in the quarter, for the company's best Q3 result in seven years. Programming costs were up 11.4 percent in the quarter due to contract renewals, higher retransmission consent fees and sports programing costs. Comcast expects programming cost to be up more than 10 percent this year and similarly higher than normal in 2017, but further out they should increase more along the traditional 7-8 percent a year, Chief Financial Officer Michael Cavanagh said. Comcast closed Wednesday at $62.56, down 3 percent. Roberts was sanguine about the possible threat of streaming cannibalizing NFL and Olympics TV viewership, with the streaming portion of the Rio Olympics being 1 to 2 percent of what TV viewership was. Similar numbers apply to the NFL, he said, saying the ratings drops might reflect that the current NFL season isn't as strong as others. NFL and Olympics coverage is profitable, Roberts said, and the modest ratings decline "doesn't cause us too much discomfort." The company meanwhile just started the launch of its Xi5 all-Wi-Fi set-top box, Roberts said. Comcast Cable CEO Neil Smit said the company should be moving to IP-based delivery of content "over the next couple years."

A big gray area in AT&T's proposed buy of Time Warner is whether the FCC will have a direct role in regulatory oversight of the $108.7 billion takeover (see 1610210043), but some observers said TW has commission licenses beyond just that for its sole TV station. Our review of International Bureau filings show TW has earth satellite stations for its CNN operations (for example, here and here). A lawyer with cable clients and deal experience said it's highly unlikely the FCC would have no role since CNN and other TW subsidiaries such as HBO and Turner probably have commission licenses.

The multichannel video programming distributor universe is either a well-functioning competitive market or rife with thumb-on-the-scale practices that favor some, say competing portraits in replies due Monday night on the FCC 18th video competition report. Multiple commenters in initial filings last month urged more market deregulation (see 1609220005).

FCC Commissioner Ajit Pai's gigabit opportunity zone idea for helping close the digital divide is seeing "some promising green shoots" of bipartisan support in Congress, he told a Project Get Older Adults Online (GOAL) event. Pai said he hopes that and other proposals for promoting universal service will be embraced in 2017 "regardless of who controls the FCC or Congress." If all goes well, the coming administration change won't derail momentum or lead to work reinventing what is happening, said Comcast Executive Director-External Affairs Jackie Puente.

Many expect to see AT&T's proposed $108.7 billion buy of Time Warner pass regulatory muster, though even AT&T says it expects conditions. Others see it facing particularly steep odds, and there are questions about what voluntary conditions -- if any -- the companies might put forward. The purchases raises a variety of possible regulatory issues (see 1610210043), and Capitol Hill is looking at the deal, too (see 1610240053).

The FCC International Bureau is proposing updates to Part 2 and 25 rules specifically to facilitate deployment of non-geostationary orbit (NGSO) fixed satellite service constellations. An FCC official told us the NPRM put on circulation Friday also seeks comment on technical rules for spectrum sharing. The official said the agency asks for input on its current rule governing in-line events -- when two NGSO systems come within 10 degrees of aligning with each other, necessitating either coordination or splitting of spectrum -- and whether that 10-degree rule should be modified. It also seeks comment on a SpaceX proposal on the FCC's rule requiring an NGSO constellation to be completely launched within six years of license grant, with the company pushing for a lower milestone of 75 percent of the constellation, the official said. The NPRM likely won't be on a future monthly meeting agenda but voted on circulation, the official said.

AT&T buying Time Warner likely would face regulatory concerns about programming and also could be a springboard for regulators to dive into other issues, like zero rating, industry lawyers and experts told us Friday. Given the increased regulatory attention paid to competitiveness and transaction issues in recent years, "I don't think they are necessarily going to have smooth sailing," said Public Knowledge attorney John Bergmayer. Some question whether the FCC would even have a role in overseeing the possible deal, but AT&T's last major acquisition was national satellite multichannel TV provider DirecTV. AT&T and TW didn't comment Friday. Several news reports Friday suggested a deal could be announced as early as the weekend.

Opposition to and criticism of AT&T's buying Time Warner have begun, including from some influential Democrats and Republicans, among them GOP presidential nominee Donald Trump on the campaign trail. That was even before any deal was announced. Confirmation came from the companies around 8 p.m. EDT Saturday, saying the transaction is worth $108.7 billion.

Repeatedly pointing to gains by the terrestrial wireless industry, satellite executives at a Thursday Dentons event said their industry should make a better case to regulators and others for its access to spectrum, especially in light of the preparation for the World Radiocommunication Conference 2019. "Saying 'no' to sharing is absolutely not an answer," said EchoStar Senior Vice President-Regulatory Affairs Jennifer Manner. People batted around ideas for unifying the satellite industry by bringing back the long-defunct Satellite Communications Users Conference or another means.

With GPS Adjacent-Band Compatibility (ABC) Assessment L-band testing done, the next step is coming up with tolerable equivalent isotropically radiated power (EIRP) levels to protect GPS from adjacent band interference, the Transportation Department told us Tuesday. Those tolerable EIRP levels will come from radiated test interference tolerance masks, use case scenarios representing relevant applications and services, and propagation modeling, Transportation said. The agency presented its ABC testing results Friday at a workshop and said there are no further plans for testing. That testing comes as Ligado has been trying to get FCC approval for its broadband terrestrial low-power service in spectrum adjacent to GPS and arguing that the proposed power and out-of-band emission levels protect GPS (see 1602250032). Ligado in a statement said it's "glad that DOT's nearly two years of testing is finally over. Now the government agencies with authority over our nation’s spectrum policy, the FCC and the NTIA, can take this information and all the other studies into account and make critical decisions. It is odd that the DOT study did not address at all the actual harm to consumers, as the other studies did. DOT also made clear that it recommends a mask based on the worst device it could find. Others will have to decide whether that is sound policy.” DOT said the reacquisition tests that were part of wired testing showed that for some receivers, there wasn't significant margin beyond the interference power causing 1 dB degradation. The degradation was particularly apparent for lower-power GPS signals, like those that would be associated with operating in challenged environments such as urban canyons or under foliage or with low-elevation satellites in open skies, DOT said. When asked about what its test findings might mean for actual device performance, the agency said the wired testing results "suggest exceeding the 1 dB interference level can adversely affect receiver performance by slowing satellite acquisition times." The department said radiated test results -- which show "the more comprehensive view of adjacent band interference causing a 1 dB degradation" in carrier to noise ratio -- were nonetheless "in good agreement ... when the performance of the active antennas were taken into consideration."