THE GREENLINING INSTITUTE
A Multi-Ethnic Public Policy, Research and Advocacy Institute
greenlining.org

Contact:
Bruce Mirken,
Greenlining Institute Media Relations Coordinator,
510-926-4022; 415-846-7758 (cell)

Samuel S. Kang,
Greenlining InstituteManaging Attorney,
415-317-5946 (cell)

LOS ANGELES —  In testimony to be delivered at a rare House Judiciary Committee hearing in Los Angeles today, Greenlining Institute managing attorney Samuel S. Kang warns the committee of serious dangers to media diversity posed by the proposed merger between NBC-Universal and Comcast. The merger, Kang says, could have a profound negative impact on jobs, the diversity of content available to viewers, women- and minority-owned businesses, minority media ownership, and ethnic media programming.

“Unfortunately, Comcast and NBCU have a poor track record of promoting minority perspectives and preserving local content,” Kang states in his prepared remarks, citing NBC’s “systematic dismantling” of Telemundo’s local news coverage and Comcasts’s reduction of local content in several markets. “The proposed marriage of NBCU and Comcast is a union of two corporations that operate by a remarkably similar modus operandi – gut, cut, and strut.”

Mr. Kang’s full testimony follows:

Oral Testimony of

Sam Kang
Managing Attorney
Greenlining Institute

Before the

US House of Representatives
Committee on the Judiciary

Regarding

The Proposed Combination of Comcast and NBC-Universal

Introduction
Mr. Chairman, and Members of the Committee, My name is Samuel Kang.  I am the managing attorney for the Greenlining Institute.  It’s a pleasure to be here today.

The Greenlining Institute is a non-profit advocacy organization that seeks to protect consumer interests while partnering with some of the largest companies in America to better serve this country’s multi-ethnic and underserved communities.

Although there are a myriad of significant problems with this merger, I will limit my testimony to three key issues:

1)      Diversity in ownership;
2)      Impact on democracy; and
3)      What a merger would mean for the economy

I. Diversity – Ownership Gap & Its Consequences

Over the last 20 years, media consolidation has diminished independent voices and sources of information, particularly diverse voices.  Unfortunately, the proposed merger does not seem to provide much to improve this situation.

Today, only five companies own 90 percent of the top 50 cable networks, produce three-quarters of all prime time programming, and control 70 percent of the prime time television market share.  These same companies also own over 85 percent of the top 20 Internet news sites.

A recent study found that while minorities comprise 34% of the U.S. population, they own only 3% of television stations.  Approximately 12% of the nation’s African American homes are in the New York City and Los Angeles markets.  However, there are no African American-owned stations in these markets.  African Americans do not even own stations in cities with large black populations like Detroit, Atlanta and New Orleans.  African American owned stations reach just 5% of the African American TV households in the US.

The problem with the lack of minority ownership is that it has a direct correlation with the lack of minority programming.

According to the UCLA Chicano Studies Research Center, there was just one Latino-themed series in 2004, down from two during 2002 and 2003.

So what is Comcast’s role in this?  Comcast may state that there is not a problem and point to diversity success stories like BET, TV One and Oxygen.

The reality is that despite Comcast’s and NBCU’s substantial holdings none of these channels is minority-owned. Many so-called “minority stations” are in fact owned by large media conglomerates. BET is owned by Viacom; Comcast holds a substantial ownership in TV One; and a large interest in Oxygen belongs to Time-Warner.

Comcast’s leadership might reveal some of the reasons for this deficiency.  The company’s 13-member board of directors includes only one woman and one person of color.  A report by the Hispanic Association on Corporate Responsibility gave Comcast a failing grade on the diversity of its workforce.

NBC similarly has a poor track record.  For example, NBC’s CEO Jeff Zucker admitted that even though NBC runs Telemundo, one of the largest Latino TV networks in the country, they have no Latinos on the board or executive team.

Comcast and NBC both say they are serious about diversity, but the truth is, both struggle when it comes to the number of minorities within their workforce and management who actually have the ability to hire or influence content.

II. Undermining Democracy
But why exactly is diverse programming such a vital issue?  The answer is that diverse programming has a critical impact on the health of our democracy.

In 2009, The American Economic Review published a groundbreaking study that showed Spanish-language local television news can substantially boost Hispanic voter turnout.

Hispanic voter turnout increased by 5 to 10 percentage points in markets where Spanish-language local television news was available. Local news in Spanish caused about one in five Spanish-language news viewers who had never voted before to start voting.

The results are real and they are significant.  If you build it, they will come, and they will vote.

Unfortunately, Comcast and NBCU have a poor track record of promoting minority perspectives and preserving local content.

This is most starkly demonstrated by NBC’s systematic dismantling of Spanish-language stations after NBC took over Telemundo.  In December 2006, NBCU eliminated locally produced Telemundo newscasts in seven markets.  They were instead replaced with regional content transmitting from consolidated hubs.

The markets that were gutted of its local programming included Houston, Dallas, San Antonio, San Jose and Phoenix.  The gutting consisted of terminating dozens of reporters, camerapersons, production team members, and producers.  These markets, alone, comprised five of the top ten Hispanic markets in the country.

In response to audience outrage, NBCU brought back four local Telemundo newscasts in February 2010 – Dallas, Houston, San Jose and Phoenix.  However, these newscasts rely on reports and images received from NBC news sources, not Telemundo’s.  Only a smattering of content is locally produced and the resources are still threadbare.

Comcast has demonstrated a similar penchant to cut local content.  In 2008, Comcast consolidated operations in Denver, Colorado, and gutted local coverage of nearby Colorado Springs.  That same year, Comcast consolidated its east-coast operations, cutting 300 positions by combining six regions into four.

In 2009, Comcast took a hatchet to New England Cable News, and most recently did it again to Sarasota and Fort Myers-Naples in Florida.

What is most disturbing about these practices is that both NBCU and Comcast seem proud about their track record.  The proposed marriage of NBCU and Comcast is a union of two corporations that operate by a remarkably similar modus operandi – gut, cut, and strut.

III. Best Case Scenario: “No Massive Layoffs”
The final point I would like to highlight is how Comcast and this proposed merger is likely to impact the economy.

As the nation’s largest cable company and second largest interest service provider, Comcast employs and contracts with numerous business enterprises.  Therefore, the fact that Comcast has demonstrated, at best, a weak commitment to contracting with minority and women-owned businesses is extremely concerning.

The procurement of minority, women and disabled veteran -owned businesses, otherwise known as supplier diversity, has been led by two prominent leaders over the last several years.  Specifically, Verizon and AT&T’s efforts in California have become national models of supplier diversity.

Comcast has neither been transparent nor active on supplier diversity.

In 2009, Comcast spent over $315 million in outside procurement in California.  Less than 16% of that total spend, a paltry $48.5 million, were attributed to minority, women or disabled veteran-owned businesses.

Verizon and AT&T directly injected almost $600 million into the diverse business community in 2009, most of it benefitting small businesses, creating jobs in diverse communities.

In stark contrast, Comcast’s supplier diversity efforts are negligible.

And yet, Comcast competes head-to-head against AT&T and Verizon.  So when Comcast takes customers and revenue away from AT&T and Verizon, Comcast is siphoning away hundreds of millions of dollars from California’s diverse economies.  As a result, this would take away much-needed jobs that otherwise would have been created.

If Comcast is allowed to get bigger and further proliferate their current business practices in California, the state’s diverse economies will be put in imminent danger

Mr. Chairman, the scenario that I am presenting is not merely theory.  It is rooted in what Comcast’s CEO, Brian Roberts, has already confirmed.  In a previous Congressional hearing, Mr. Roberts all but assured job losses would directly result from the merger.  All that he could promise was that the merger will lead to “no massive layoffs.”

It is unacceptable that when everyone is trying to figure out how to create jobs, Comcast’s best prognosis is “no massive layoffs.”  But Comcast is only following its old MO – gut, cut and strut.

Congress 5, FCC 0
So how come there are such gaping deficiencies in Comcast’s application?  A major reason is the lack of public input in the regulatory process.

After today, Congress will have held five hearings on this landmark transaction.  The FCC will have held none.  The FCC took an adequate first step with an announcement of one event in Chicago.  Unfortunately, the Chicago event is classified as a forum, and not a hearing.

FCC Commissioners Clyburn and Copps have been adamant about calling for public hearings so that commissioners would be expected to attend and receive direct public input on this landmark merger.  But so far, FCC Chairman Julius Genachowski has not answered that call.

It is crucial that the FCC demonstrate that this administration’s regulators can sufficiently protect the American people and call for public hearings as Commissioners Clyburn and Copps have urged.

We have learned from the BP disaster what can happen when there isn’t diligent and transparent regulatory scrutiny.  That scrutiny must be on the front end, and not an afterthought.

I sincerely hope that this administration’s regulatory scrutiny of the Comcast merger is more comprehensive than its regulatory scrutiny of offshore drilling.  Otherwise, the consequences could be just as disastrous.

It’s time for the FCC to get off the bench and get in the game.  The FCC must call for public hearings to demonstrate its leadership over this issue and show the American people that this administration can and will protect the public interest.

Thank you.

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