FCC pauses review of Comcast, AT&T deals over contract fight

A Time Warner Cable truck is viewed in Brooklyn on August 27, 2014 in New York City. Time Warner Cable, which has 11.4 million subscribers in the United States, suffered a massive power outage Wednesday morning across the nation. While customers appeared to have power back by mid-morning, thousands had lost internet service for the duration of the outage. In a deal that is valued at $45.2 billion, Time Warner Cable is attempting to merge with Comcast. (Photo by Spencer Platt/Getty Images) less A Time Warner Cable truck is viewed in Brooklyn on August 27, 2014 in New York City. Time Warner Cable, which has 11.4 million subscribers in the United States, suffered a massive power outage Wednesday ... more Photo: Spencer Platt / Getty Images Photo: Spencer Platt / Getty Images Image 1 of / 1 Caption Close FCC pauses review of Comcast, AT&T deals over contract fight 1 / 1 Back to Gallery

The U.S. reviews of Comcast Corp.’s bid for Time Warner Cable Inc. and AT&T Inc.’s proposed purchase of DirecTV are at risk of taking longer to complete as regulators resolve disputes over who can see programming contracts.

The Federal Communications Commission, in a notice on its website Wednesday, stopped an informal 180-day clock in both reviews and suspended deadlines for comments, citing arguments by programmers over disclosing their contracts with the cable and satellite-TV companies.

Comcast said it still anticipates that the review of the Time Warner Cable deal will be finished by early next year. AT&T said it’s not changing its expectation of having the DirecTV acquisition close in the first half of 2015.

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Companies including CBS Corp., Walt Disney Co. and 21st Century Fox have asked the FCC to take more steps to limit who can review carriage contracts filed with the agency as part of its reviews of the media mergers.

“The fact that the FCC is willing to pause them both shows it’s taking the concerns of people who are objecting to the mergers very seriously,” said John Bergmayer, senior staff attorney for the Washington-based policy group Public Knowledge, which opposes the Comcast merger.

Comcast, the largest U.S. cable-TV company, proposed buying No. 2 Time Warner Cable for $45.2 billion in February. AT&T, the largest U.S. telephone company by revenue, followed in May with its $48.5 billion agreement to buy satellite TV provider DirecTV.

For Comcast and AT&T, getting bigger means greater negotiating power with video providers, from traditional cable networks to online video-streaming services. Their deals are part of a wave of merger activity in the telecommunications industry as companies seek to control the technology consumers use for entertainment and information.

Critics such as Public Knowledge, Dish Network Corp. and Netflix Inc. have said Comcast, if allowed to acquire Time Warner Cable, may use its power to unfairly compete with rivals. Comcast and Time Warner Cable said the deal won’t reduce competitive choices for consumers because the companies aren’t rivals for subscribers.

Dish and others told the FCC the unresolved dispute over the programming contracts hampered their ability to “meaningfully comment and participate” in the review, the agency said in its order Wednesday.

“We agree with these commenters,” the FCC said in the order signed by William Lake, chief of the agency’s media bureau.

“It is routine for the FCC to pause the review of significant transactions as it works to create a full record,” Sena Fitzmaurice, a Comcast spokeswoman, said in an e-mailed statement. “The commission is working to hear the concerns of various parties.”

Fitzmaurice added that the company is “confident the commission will quickly resolve these issues” and that the review will be completed in early 2015.

“The FCC’s decision to stop the clock has nothing to do with the merits of our deal,” Michael Balmoris, a spokesman for AT&T, said in an e-mailed statement. “The FCC stopping the clock on merger reviews is fairly common and today’s decision does not change our expectation to close our deal in the first half of 2015.”

After ruling in arguments over access to programming contracts, the FCC will establish new pleading cycles, according to the order.

Todd Shields is a Bloomberg writer. E-mail: tshields3@bloomberg.net