The proposed combination of Comcast, the largest distributor of video services in the United States, and NBC Universal (NBCU), a major producer and aggregator of video content, would create a huge, vertically integrated entity with potentially enormous negotiating power at a time when market forces already are altering traditional content provider/distributor relationships. Comcast would own or control media and entertainment properties of significant scope and scale, including: Comcast's cable systems, which currently serve 24.2 million subscribers, making Comcast the largest provider of multichannel video programming distribution (MVPD) services in the United States; Comcast's broadband network, which passes more than 50 million homes and provides high speed Internet service to just under 15 million households, making Comcast the largest residential information service provider (ISP) in the United States; A number of national cable networks, including NBC's USA, Bravo, CNBC, MSNBC, Oxygen, and Syfy networks and Comcast's E!, Style, Golf Channel, and Versus networks, as well as minority interests in the A&E, Biography, History Channel, Weather Channel, and Lifetime cable networks, and small interests in the Big Ten, NHL, and MLB cable networks; Comcast's 10 regional cable sports networks; The NBC national broadcast television network, including NBC News (a leading source of global and national news with top-rated news programming), NBC Universal Sports and Olympics (which holds contracts to broadcast the 2010 Winter Olympics and 2012 Summer Olympics, NBC Sunday Night Football, NHL/Stanley Cup, the PGA Tour, the U.S. Open, the Ryder Cup, Wimbledon, and the Kentucky Derby), and NBC Entertainment; NBC's Telemundo national broadcast television network, the second-largest Spanish language programming network in the United States; NBC's ten owned and operated local broadcast stations, which carry the NBC network programming in large U.S. markets, including New York, Los Angeles, Chicago, and Philadelphia; NBC's 16 owned and operated local broadcast stations, which carry the Telemundo network programming in cities with large Spanish-speaking populations, including Los Angeles, New York, Miami, Houston, Chicago, and Dallas; NBCU's large television production operations, which produce broadcast network programming, NBCU Television Distribution's broadcast program syndication operations, and a 3,000-title library of television episodes; NBCU's Universal Pictures and Focus Features, which produce theatrical and non-theatrical films, as well as Universal Studio Home Entertainment's extensive movie library with more than 4,000 titles; Digital media properties, including CNBC.com, iVillage, NBC.com, Fandango, and Daily Candy, which together generate more than 40 million unique users each month; and NBC's 30% interest in Hulu.com, a website that offers free, advertising-supported streaming video of broadcast and cable television programs. Despite the size and reach that Comcast would be afforded if the deal is completed, there is so much uncertainty in the video market that the proposed combination has elicited a wide range of predictions about (1) how it would affect that market; (2) how it would affect the long-standing public policy goals of competition, diversity of voices, and localism; and (3) whether the merger would prove beneficial to Comcast's shareholders. From one perspective, the scope of the combined entity would be so broad that, in addition to requiring careful scrutiny of its competitive effects, it potentially could affect market structure and relationships in ways that have implications for a wide range of media rules, regulations, and policies, including program carriage rules, program access requirements, retransmission consent rules, long-standing policy supporting free over-the-air broadcast television, and even network neutrality and open access policies. From another perspective, the recent history of failed mega-mergers in the communications sector suggests that the vertically integrated post-merger entity may have so many pieces with conflicting market incentives that it proves impossible for executives to craft an internally consistent profit-maximizing business strategy, much less exploit market power to undermine competition. There is consensus that the Department of Justice (DOJ) and the Federal Communications Commission (FCC) are likely to approve the combination subject to merger conditions and/or license conditions—intended to protect competition, diversity of voices, and localism—that may significantly affect the impact of the combination. It is possible, however, that such conditions might have the effect both of protecting the public against significant harms created by the combination and of limiting potential benefits created by the combination. With or without the Comcast-NBCU combination, the video market is in a state of flux. Significant technology-induced structural changes on both the supply side and the demand side of the market are fragmenting audiences, affecting the level of revenues generated, and shifting the flow of those revenues among industry players. Long-standing business models of both content providers and distributors are being challenged. The impact of the proposed merger on the video market and on public policy goals will be affected by these dynamic forces currently at play. Some of the structural changes are the result of independent new competitors entering the market. Others are the result of firms that already had a strong market presence expanding or extending into new activities. On the distribution side, technological innovation has generated major new entry. In the early 1990s, when many of the regulatory rules affecting content-distributor relationships were adopted, there was little competition to cable in the MVPD market. In June 1994, fewer than 2 million households subscribed to satellite television service, and most of those used the C-band technology; fewer than 70,000 were served by direct broadcast satellite (DBS), which was still in its infancy. Telephone companies were not offering video services at all. Cable dominated, with 59.5 million basic cable customers in 1994, out of a total of 94.2 million television households. Most cable subscribers had not retained their rooftop broadcast television antennas; if their cable company chose not to carry a particular local broadcast station's signal, many subscribers no longer were able to receive the broadcaster's programming (including the advertising) and had no alternative source for that programming. Since the cable company's carriage decision heavily determined the number of viewers that would view a broadcaster's programming and advertising, it enjoyed a very strong negotiating position vis-à-vis the broadcaster. In contrast, today most American households have access to the two major DBS providers, DirecTV and Dish Network; there are more than 31 million subscribers to satellite video service. In addition, at mid-year 2009, Verizon's FiOS television service was available to 10.3 million households and purchased by 2.5 million households, and AT&T's U-verse service, at the end of the third quarter of 2009, was available to approximately 20 million households and purchased by 1.8 million households. The FiOS and U-verse services are not available in the same markets. Thus most households have access to at least three MVPD providers and MVPDs that fail to carry "must-have" broadcast (or other) programming that their competitors offer may find themselves at a significant competitive disadvantage. Hence broadcasters and other programmers are in a strengthened negotiating position vis-à-vis MVPDs. At the same time, consumer electronics manufacturers have added a number of streaming video capabilities to a range of devices that allow consumers to easily connect their televisions to the Internet. Such devices include Internet-ready high definition televisions (HDTVs), DVRs, Blu-Ray DVD players, video game consoles (including Xbox 360, PlayStation 3, and Wii), and dedicated boxes (such as the $80 WiFi- or Ethernet-enabled Roku player). These devices provide access to numerous video on demand (VOD) services, including Netflix, Amazon Video, MLB.com, and YouTube. They have created an entirely new way to distribute video. The introduction of the highly mobile Apple iPad provides another alternative for consumers to watch video over the Internet through a WiFi/3G-enabled device that is considerably larger than the iPhone, Android phone, or iPod Touch. One of Apple's potential advantages is the iTunes Store, which is capable of supplying a significant amount of additional content to consumers. All of these products (including home computers and laptops) allow consumers at home and on the road to access a potentially unlimited supply of programming available over the Internet. It is not clear whether Internet-based VOD services will gain sufficient access to desirable programming—and particularly to the "must-have" programming that a significant portion of viewers require from their video service. Nevertheless, the emergence of Internet-enabled, HDTV-quality Internet service could ultimately prove to be disruptive to MVPDs and over-the-air broadcasters. On the content side, structural changes have been fragmenting audiences for more than two decades, but just when that fragmentation seemed to be abating, new market forces have been created to continue the trend. The initial cause of audience fragmentation was the successful entry of cable networks. As these networks proliferated they also evolved from primarily offering re-run broadcast or theatrical film programming to offering substantial amounts of original programming. Today there are more than 500 cable networks, 35 of which come into more than 90 million households and another 42 that come into more than 50 million households. More than 85% of all television households in the United States subscribe to MVPD service and the average television household receives 130 television channels. As recently as the early 1990s, the then-three major broadcast networks (ABC, CBS, and NBC) and their affiliates commanded approximately 49% of U.S. television home set usage; today, the four major broadcast networks (with the successful entry of FOX) and their affiliates command only approximately 25%. Other broadcast stations command an additional 13% of television usage.