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 NEWS  News  media  Information  202  /  418-  0500  Fax-  On-  Demand  202  /  418-  2830  TTY  202/  418-  2555  Internet:  http://  www.  fcc.  gov  ftp.  fcc.  gov  Federal  Communications  Commission  445  12  th  Street,  S.  W.  Washington,  D.  C.  20554  This  is  an  unofficial  announcement  of  Commission  action.  Release  of  the  full  text  of  a  Commission  order  constitutes  official  action.  See  MCI  v.  FCC.  515  F  2d  385  (D.  C.  Circ  1974).  FOR  IMMEDIATE  RELEASE  NEWS  MEDIA  CONTACT: 
 October  9,  2002  Michelle  Russo  202-  418-  2358 
 FCC  RELEASES  TWO  NEW  MEDIA  BUREAU  STAFF  RESEARCH  PAPERS 
 The  Media  Bureau  of  the  Federal  Communications  Commission  (FCC)  today  released  two  new  papers  in  the  Staff  Research  Paper  series.  The  goal  of  this  series  is  to  closely  examine 
 marketplace  issues  that  affect  media  policy  and  regulation.  These  two  papers  are  not  part  of  the  Media  Ownership  Working  Group  studies  that  were  recently  released  and  incorporated  into  the 
 third  Biennial  Regulatory  Review  of  Broadcast  Ownership  Rules  proceeding. 
 Today’s  papers  examine  various  possible  economic  impacts  of  consolidation  on  cable  operators’  bargaining  power  in  the  programming  market.  Nodir  Adilov  of  Cornell  University 
 and  Peter  J.  Alexander  of  the  FCC’s  Media  Bureau  authored  both  papers.  These  papers  represent  the  individual  views  of  their  authors  and  do  not  necessarily  reflect  the  views  of  the  FCC,  any 
 FCC  Commissioners,  or  other  staff. 
 The  first  paper,  “Asymmetric  Bargaining  Power  and  Pivotal  Buyers,”  examines  the  possible  effects  of  merger  on  the  bargaining  power  of  the  merged  firm.  Some  previous  research 
 suggests  that  a  merged  firm’s  bargaining  position  can  actually  be  worsened  post-  merger.  The  current  study  suggests  that  this  worsening  of  bargaining  position  may  occur  in  the  case  where 
 buyer  bargaining  power  is  equal,  but  not  in  the  case  where  buyer  bargaining  power  is  unequal. 
 The  second  paper,  “Most  Favored  Customers  in  the  Cable  Industry,”  explores  the  implications  of  most-  favored-  customer  (MFC)  clauses  in  the  cable  industry.  The  paper 
 demonstrates  that  the  introduction  of  a  most-  favored-  customer  clause  for  large  buyers  may  increase  their  profitability,  and  that  a  seller’s  profits  may  decrease. 


 The  issues  discussed  in  these  two  papers  are  now  a  part  of  the  record  of  the  FCC’s  consideration  of  the  pending  cable  ownership  rulemaking  proceeding  (CS  Docket  Nos.  98-  82, 
 96-  85;  MM  Docket  Nos.  92-  264,  94-  150,  92-  51,  87-  154,  16  FCC  Rcd  17312  (2001))  and  the  AT&  T-  Comcast  license  transfer  proceeding  (MB  Docket  No.  02-  70,  released  March  29,  2002). 


 The  full  text  of  these  papers  is  available  at  www.  fcc.  gov/  mb  or  on  ECFS. 
 Media  Bureau  contact:  Royce  Sherlock  at  202-  418-  7200. 
 =  FCC  = 
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