Wave Broadband, an internet and TV service company based in Kirkland, Wash., filed a suit with the Federal Communications Commission on Tuesday against Comcast, citing “unfair business practices” related to Comcast’s NBC Sports channel bundles.
Wave alleges that Comcast is trying to force the company to include Comcast’s NBC Sports regional channels in Wave’s basic TV tier, which it says will increase its cost to subscribers “significantly.”
Wave offers customers in Seattle, Portland, Sacramento, and San Francisco two options for TV: a local broadcast tier and an expanded content tier that includes channels from cable networks.
Wave says that, “unlike all other programming vendors, Comcast Sports Nets requires operators like Wave to sell a minimum number of expanded content subscriptions tied to the number of Local Broadcast tier subscribers.”
Here’s more explanation from Wave’s press release:
As a result, Wave would be required to bundle localized versions of the Comcast Sports Nets (now branded as NBC Sports Northwest; NBC Sports Bay Area; NBC Sports California) channels included in its Local Broadcast tier, thus increasing its cost to subscribers significantly. Separately, Comcast’s other video division includes terms in its contract that requires its channels to be bundled into the same channel package as Comcast Sports Nets programming. As a result of those terms, all of Comcast’s content would have to be bundled into the Local Broadcast tier, further increasing its cost to subscribers. Additionally, other media companies—unrelated to Comcast Sports Nets—have terms in their contracts that require operators like Wave to bundle their channels in the same tier as Comcast Sports Nets’.
If Comcast Sports Nets prevails in forcing Wave to bundle its channels in the Local Broadcast tier, all video subscribers would then be forced to subscribe to this bundled channel package at a content cost of more than $70 per month—with consumers paying for more channels than they are interested in viewing.
Further, Comcast Sports Nets is making its programming available through alternative streaming platforms like FuboTV and others. With more ways for customers to access this programming, the demand for Wave to maintain a high penetration rate of subscribers to their channels is anticompetitive and yields double payment to Comcast for its programming.
The Seattle Times notes that Wave tried to renew its contract for the sports channels with Comcast this year and Comcast refused to change the required minimum number of expanded content subscriptions, according to Wave, even though it now offers the channels on other streaming platforms.
“What consumers want is the ability to pay only for the content they want to watch,” Wave CEO Steve Weed said in a statement. “Comcast is trying to force their competitors like Wave to only offer a single set of bundled channels—this is the opposite of what consumers want.”
Wave, which also competes with Comcast for internet and TV subscribers, is in the process of being acquired by TPG Capital and combining with two other companies — RCN Telecom Services and Grande Communications Networks — to form the nation’s sixth largest internet and cable operator in a $2.36 billion deal.
In a statement, NBCUniversal said it is “mystified” by the suit.
“We are mystified by Wave’s action,” NBCUniversal said. “Wave’s sale to RCN and a private equity group is expected to close within a month, so NBCUniversal offered an extension until they come under new ownership and has separately offered marketplace terms to RCN for continued carriage on these systems thereafter. NBCUniversal has engaged with them fairly, on the same terms as other distributors. Their purported claim is without merit.”
