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Comcast’s top government guy says Trump won’t stop many mergers

Exec David Cohen also raises some potential concerns with the Sinclair-Tribune deal.

Comcast Executive Vice President David Cohen speaking onstage behind a podium Larry Busacca/Getty Images for WICT

President Donald Trump has previously threatened to break up Comcast* while repeatedly taken aim at one of its rivals, AT&T, as the wireless giant inches closer to purchasing Time Warner.

But Comcast’s leading voice in Washington, D.C. — David Cohen — told Recode that the regulatory climate for big mergers remains as friendly as ever in the nation’s capital, no matter what Trump himself has said.

“Overall, this president and this administration is likely less hostile to horizontal growth or even vertical growth in the telecom space and elsewhere,” Cohen explained during an interview that will air this weekend on C-SPAN’s “The Communicators.”

By vertical, Cohen meant mergers that open companies to new lines of business; with respect to horizontal, he was referring to deals that combine two companies that directly compete against each other. “I don’t think that’s a license for ‘anything goes,’” Cohen continued. But, he added there’s “pretty clearly going to be less hostility and a greater willingness to allow the market to work.”

Of course, there’s no shortage of transactions currently awaiting the U.S. government’s approval — deals that will test Cohen’s thesis. For one thing, AT&T is far enough along in its quest to buy Time Warner that regulators studying it at the Justice Department are now weighing whether to apply conditions on the deal, sources have said.

It’s a radical departure from Trump’s promises on the campaign trail to block the merger outright. Other reports even suggested White House aides aimed to use the merger as leverage against CNN, the Time Warner-owned news outlet that’s covered Trump critically.

At the Federal Communications Commission, meanwhile, telecom regulators are still reviewing Sinclair’s $3.9 billion bid to buy Tribune Media — a mega deal that could see the combined companies reach as many as 70 percent of American households. And the FCC could have additional work to do in wireless if reports prove true and Sprint and T-Mobile finally try to combine forces.

Sinclair-Tribune and pricing concerns

For now, Cohen said he didn’t want to talk about those deals, including whether Comcast had ever raised any concerns with the DOJ about the combination of AT&T and Time Warner. With Sinclair and Tribune, Cohen said the same before acknowledging that there’s some good and some bad for his company — and consumers — in that broadcasting merger.

“I think having that large a bloc of local broadcast affiliates, it almost inevitably [will] put significant upward pressure on retransmission consent fees, which are the No. 1 driver of increases in cable prices for consumers these days,” Cohen said.

Those fees refer to the rates that cable operators pay broadcasters to carry their signals. And Cohen pointed to a number of “economic studies” filed at the FCC in recent weeks that “highlight the potential anti-consumer implications,” given the effect of higher rates on cable subscribers.

Remember, though, Comcast owns NBCUniversal, and those stations collect retransmission fees, too. That’s probably why Cohen said during the interview that there are some “potential good things for the company, particularly on the NBCUniversal side,” as a result of the Sinclair-Tribune deal. He didn’t further elaborate.

Comcast’s own merger bets

Comcast also might find itself in that M&A mix, particularly as it continues its work to ramp up its efforts in wireless. Earlier this year, it inked a major partnership with rival Charter, a pact that prevents either company from pursuing a wireless deal without the other’s permission. Then, Comcast, Charter and Sprint set themselves a two-month window for exclusive talks about a potential tie-up.

More recently, speculation has swirled that Comcast could find itself lapped into an even larger deal, including perhaps a purchase by Verizon. At the moment, though, Comcast continues to rely on Verizon’s network to deliver its own new wireless offering, called Xfinity Mobile. And Cohen didn’t unveil any new big plans Tuesday.

“We’re not out there saying, ‘Oh my god, to survive we need something else to buy,’” he said. “On the other hand, we have never viewed ourself from being foreclosed from the acquisition marketplace, either domestically or internationally.”

In doing so, Comcast may once again find itself on the receiving end of Trump’s ire — potentially in the form of critical tweets from a president that previously took aim at Comcast for its ownership of NBC.

From the campaign trail to the Oval Office, Trump has also blasted companies like Amazon and threatened scores of others, at times even denting their stock prices. But Cohen said he believes “most of what the president is doing on Twitter is conversation; it’s not policy.”

“It’s certainly a glimpse into the way in which he is thinking. But there are plenty of things that he’s tweeted where, a month later, he has tweeted something else that in a different context is 180 degrees or 160 degrees from what he initially tweeted.”

“Maybe I’m wrong,” he said, “but I’m actually less concerned than a lot of my friends about the president’s tweets.”

* Comcast, through its NBCU arm, is an investor in Vox Media, which owns this website.

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