Former Comcast exec defends Byron Allen lawsuit, exposes company’s dealings with Black networks
"Comcast has not been a good business partner."
Another major voice is speaking out about cable giant Comcast and its shaky relationship with Black business owners- and this time, it’s a company insider.
On Friday, Paula Madison, a former NBC Universal executive, released a statement alleging that the company left Black cable networks to fail, even while it touted them as examples of diversity. Comcast owns NBC Universal.
Madison was present during MOU (Memorandum of Understanding) negotiations in 2011, in which Comcast agreed to launch channels led by Black entrepreneurs such as Sean “Diddy” Combs (REVOLT) and Magic Johnson (ARISE).
However, Madison says her concerns about a lack of meaningful distribution (I.e. guaranteed subscribers and revenue), fell on deaf ears.
“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. Period.”
“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. Period.”
Madison, whose family’s investment business is the largest stakeholder in The Africa Channel, which is run by Comcast, says the company “has not been a good business partner,” in that regard either.
“The Africa Channel’s (“TAC”) relationship with Comcast has been cordial…but
our economic relationship cannot be described as a good one,” says Madison.
“Comcast spends in excess of $12 billion in licensing cable networks of which Black-owned networks receive a negligible amount.”
Madison retired from NBC in 2011 after 35 years in the news business and had been named one of the “75 Most Powerful African Americans in Corporate America.”
Her statement comes the same week as Sean “Diddy” Combs blasts Comcast for its legal attack on the Civil Rights Act of 1866 as it battles Byron Allen in court over racial discrimination claims.
Similar to Madison, Diddy claims his REVOLT TV network was left to flounder after its initial launch.
“As someone who was a corporate insider and helped to craft the MOU, I can honestly say that after reading Sean Diddy Combs’ official statement about Comcast, he has every reason to feel the way he does,” she says.
“I believe Byron Allen’s $20 billion lawsuit must be allowed to proceed to trial so we can hear all of the details and the truth.”
Read the full statement from Paula Madison below:
“The Africa Channel’s (“TAC”) relationship with Comcast has been cordial and at times even jovial but our economic relationship cannot be described as a good one. Yes, Comcast is distributing TAC (in business since 2005 and my family’s investment business is the largest shareholder) to about 4 million subscribers but it has not meaningfully expanded our subscriber base beyond about 2 million Comcast subscribers. In 2011 during the Memorandum of Understanding (“MOU”) process, TAC requested that Comcast count it among the three channels it would launch, believing those new channels would be distributed to tens of millions of Comcast subscribers. Because TAC was already carried in approximately 2 million Comcast households, TAC was denied and told we were ineligible. (Indeed, Comcast is the largest distributor of our small, independent cable network.)
At that time, Comcast assured the leaders of the NAACP, National Action Network and The National Urban League that Comcast would increase TAC’s subscriber count from 2 million to 6 million, which for a small, independent cable network would have resulted in a palpable economic boost. Eventually, TAC received just half of the promised increase. Since then, TAC has been in conversations with Comcast regarding the additional cable carriage. We have been told that carrying TAC “on demand” might be a possible solution. Their representative said Comcast is considering networks with zero to very low license fees. And so with virtually no leverage, we offered to reduce our carriage fee or even agree to a flat fee in exchange for wider distribution.
We still believe that a loss in carriage revenues would be offset by increased advertising revenue generated by a larger subscriber base, but Comcast consistently has dismissed those requests. TAC has been an extraordinarily good partner by supporting all of Comcast’s multicultural initiatives such as sponsoring the Odunde Festival, the largest African gathering in Philadelphia — home of Comcast — as well as other Xfinity VOD marketing initiatives targeting the African American community but to no meaningful reciprocity. Although Comcast has not shut out TAC, Comcast has not been a good business partner. With an unkept — yet repeated — promise by Comcast of 4 million additional subscribers it’s inaccurate to include TAC in any grouping of Black-owned independent networks which would typify the Comcast business relationship as good or in any way proactive. During the MOU process, I met with Chicago Congressman Bobby Rush as part of the Congressional approval process.
We met in his DC office and he asked me to assure him that Comcast would continue the innovative and meaningful progress in diversity and inclusion that as NBCU’s EVP & Chief Diversity Officer, I had led at NBCU. I assured Congressman Rush that I did not know if the Comcast folks would do so and certainly had no way of predicting this. I did say that GE, NBCU’s parent company, was an industry leader regarding Diversity & Inclusion and that NBCU was an industry leader regarding Diversity & Inclusion (“D&I”) and that Comcast was promising Congress that it would work for greater economic success for the African American community as stated by the commitments regarding procurement, banking, employment, etc. I said that I was meeting with him as one of my assigned responsibilities to fulfill what was needed to secure for Comcast the government approval to acquire and own NBCU. I said I was taking Comcast at its word. Launching these Black entrepreneurs’ new cable networks without meaningful distribution and real economic inclusion, in my opinion, would result in a business model fraught with frustration and near futility.
As the NBCU team leader who worked on and negotiated the MOU with the African American civil rights leaders, separately I had raised with Comcast that without a guaranteed subscriber count giving the Black entrepreneurs significant revenue and profit, the launch of these channels would not help them achieve success in business. Indeed, as an owner of The Africa Channel, I recused myself from any Comcast-TAC discussions but I also knew from experience that without the key components of a guaranteed number of subscribers and revenue, running a profitable cable network would be very problematic. 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. Period.
None of the Black-owned networks sought cable carriage solely with Comcast. We all sought carriage on Time Warner, Charter, Cox, etc. However, Comcast was seeking to acquire one of the largest content creators in the world, NBCUniversal. And for that reason, Congress legislated that Comcast enter the MOU. 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. The amount of money Black cable network owners get from their business relationship with Comcast can only be characterized as very small.
In fact Comcast spends in excess of $12 billion in licensing cable networks of which Black-owned networks receive a negligible amount. Because The Africa Channel has been included in Comcast citations which suggested that we are in a good business relationship, I am writing this statement to set the record straight. I felt compelled to speak up and tell the truth for many reasons, especially after reading the falsehoods spread by Brian Roberts and David Cohen of Comcast. As someone who was a corporate insider and helped to craft the MOU, I can honestly say that after reading Sean Diddy Combs’ official statement about Comcast, he has every reason to feel the way he does.
In fact, I considered some weeks ago, filing an amicus brief to Byron Allen’s lawsuit but after communicating with my fellow Vassar College alum Sherrilyn Ifill of Legal Defense Fund, I decided not to do so. I’m convinced there are a number of amicus briefs filed with SCOTUS that I believe make a positive and convincing argument that his case must be allowed to continue. I also spoke with National Association of Black Journalists (“NABJ”) President Dorothy Tucker expressing my great concern that the Civil Rights Act of 1866 would be gutted by Comcast and U.S. Attorney General Barr and so I encouraged NABJ, of which I am a lifetime member, to speak out and indeed NABJ has done so. After watching Comcast’s actions regarding the statute, I am now convinced that I have to speak up. Again, this is the reason I am writing this statement. Section 1981(a) of the 1866 law states, “… [C]itizens… of every race… without regard to any previous condition of slavery… shall have the same right… to make and enforce contracts… as is enjoyed by white citizens…” I believe Byron Allen’s $20 billion lawsuit must be allowed to proceed to trial so we can hear all of the details and the truth.”
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