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Former NBC exec says Comcast merger deal failed to help minority-owned TV networks succeed

The cable giant continued to take heat over its racial discrimination case before the U.S. Supreme Court.

The Comcast logo inside company headquarters in Philadelphia on Oct. 24, 2016. Bloomberg photo by Charles Mostoller.
The Comcast logo inside company headquarters in Philadelphia on Oct. 24, 2016. Bloomberg photo by Charles Mostoller.Read moreCharles Mostoller

A former NBCUniversal executive said Friday that a deal struck by Comcast and civil rights groups never gave minority-owned channels a real chance to succeed, as the cable giant continued to take heat over its racial discrimination case before the U.S. Supreme Court.

Before winning federal approval in 2011 to merge with NBCUniversal, Comcast signed a pledge to launch minority-owned television networks in an agreement with the NAACP, National Urban League, and National Action Network.

But the agreement did not guarantee the channels a minimum number of subscribers, or fees per subscriber, to help the new networks succeed, said Paula Madison, a former executive vice president and chief diversity officer at NBCUniversal. Her statement was released by Entertainment Studios, the company run by Byron Allen, who is suing Comcast for $20 billion in a racial-discrimination lawsuit.

“Comcast was bound by the agreement to launch the cable networks but was not bound to distribute to a requisite number of households/subscribers so the channels never had a good chance of having a profitable and successful business,” Madison said.

Madison left NBCUniversal after the merger to work with The Africa Channel (TAC), which Comcast was already distributing before the 2010 agreement. Her family has the largest ownership stake in TAC. Madison said Comcast has “not been a good business partner,” claiming the Philadelphia-based company never kept promises to distribute the channel to millions of more subscribers.

Comcast said the distribution guarantees are included in the individual contracts with each programmer. The company noted that it is The Africa Channel’s largest distributor and said it has “always met or exceeded our commitments to this channel.”

“Comcast is proud of our strong commitment to diversity and inclusion, including an unmatched record of supporting diverse and independent networks, carrying 160 independent networks, 100 of which are targeted to diverse audiences," a Comcast spokesperson said Friday. “We are also proud to have launched eight new minority-owned cable channels since 2011, bringing these channels into millions of homes. From the start, we provided a long-term commitment to carriage of these channels and were committed to the success of these channels. Seven years after the launch of the channels under the [the deal with civil rights groups], all of them are still carried to millions of Comcast homes.”

Comcast needed approval from the Federal Communications Commission to acquire NBCUniversal and reaching an agreement with civil rights groups was seen as pivotal in getting the FCC’s support. Comcast completed the purchase on January 2011.

Madison, one of the executives to sign the agreement, said she raised concerns with Comcast that without a guaranteed subscriber count giving black entrepreneurs significant revenue, "the launch of these channels would not help them achieve success in business.”

“I shared these concerns with Comcast — that the African American networks would be positioned to fail — and Comcast made it clear that it was only committed to launching these networks, and not giving them the necessary distribution and economic support to succeed,” she said.

Madison spoke out Friday, a day after music mogul Sean “Diddy” Combs similarly criticized Comcast over its carriage of minority-owned channels. Combs’ Revolt TV is also carried by Comcast, but Combs said the channel has not received “the level of support needed to build a successful African American-owned network.”

Revolt and film director Robert Rodriguez,'s El Rey television network were announced as part of Comcast’s pledge in 2010 to carry more minority-owned companies. Also on Friday, Rodriguez said he agrees with Combs that Comcast has not done enough to support the networks.

“While we are grateful for the opportunity Comcast gave us as the first distributor to launch our networks to service our communities, we want to be very clear that they had significantly more to gain financially,” Rodriguez told Cable Fax Daily.

The flurry of statements against Comcast come as the company battles Allen in court. Allen sued the corporation, alleging that Comcast didn’t carry his cable channels because he is black. The U.S. Supreme Court is set to decide in a few months whether Allen’s case can proceed.

Comcast has said that it declined to carry the channels because of low ratings. Many focused on topics such as comedy, cars, courts, and pets. And the company strongly defended its commitment to diversity in a blog post Thursday.