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Monday, November 15, 2010, 06:20 am PT (09:20 am ET)

Approval of Comcast-NBC deal could require content deals with Apple

As the U.S. government looks to approve Comcast's acquisition of NBC Universal, the purchase could come with "significant conditions" to prevent Comcast from withholding TV and movie content from companies like Apple.

Federal regulators hope to conclude their review of the Comcast-NBC deal by the end of 2010, according to The Wall Street Journal. Neither the U.S. Justice Department nor the Federal Communications Commission are expected to block the $13.75 billion deal, because NBC Universal and cable provider Comcast are not direct competitors.

"Both agencies, however, are likely to impose significant conditions to prevent Comcast from withholding, or threatening to withhold, NBC Universal's programming from competitors, including companies that distribute TV shows and movies over the Internet, such as Apple Inc. and Netflix Inc., according to people familiar with the matter," the report said.

The government is concerned that Comcast, which serves video to cable customers through its On Demand channel as well as Fancast.com, could promote its own services over competing options, like Apple's iTunes. The report also said that a "net neutrality" condition could be a part of the deal, preventing Comcast from slowing access to services like iTunes.

The alleged conditions being discussed by federal regulators are said to be a major unresolved issue with Comcast executives. Officials with the cable provider have charged that the government should stay out of the "rapidly evolving" market.

The government's apparent interest in the online video market has been known for months, but Monday's report from the Journal is the first indication that the government could impose sanctions to prevent Comcast from withholding content from Apple's iTunes. Currently, the General Electric-owned NBC does not offer TV show rentals for the new Apple TV.

Currently, only shows from Fox and ABC are available for rent on the streaming-centric Apple TV. Apple has pushed the studios to allow 99 cent rentals, but NBC and CBS opted to pass on the proposed pricing.

Apple Chief Executive Steve Jobs was hopeful in September that the networks that chose not to participate would soon "see the light and get on board pretty fast." But executives with Warner Bros. said they find the 99 cent pricing to be too cheap.