• Donna Block reports on the scrutiny that the deal will receive from lawmakers and consumer activists.
• George White takes a look at whether the joint venture can be compared to the ill-fated blockbuster merger of America Online and Time Warner Inc. (NYSE:TWX) nearly a decade ago.
• Kenneth Klee analyzes the structure of the joint venture, concluding that is a tribute to modern dealcraft. 

• Gerald Magpily speculates whether the market would be interested Vivendi's 20% stake in NBC Universal, concluding that " if an IPO does happen in the current media environment of sluggish ad revenue, expect the demand to be tepid at best. The only ones likely to profit from a public offering of NBCU are likely to be the banks through their IPO fees."
• Paul Whitfield takes a look at how tight-lipped all the parties in the deal have been in "Vivendi coy on NBC plans."
• Gerald Magpily points to GE CEO Jeffrey Immelt's comments at the Web 2.0 Summit in San Francisco on Oct. 21 that he remains "totally comfortable" owning NBC Universal.

Now that Time Warner is spinning off its cable unit, it is freer -- and sitting atop a pile of cash -- to focus on other endeavors. The Deal's Richard Morgan laid out an intriguing scenario in early May:

Let's assume General Electric Co. finally decides it's time to spin out or spruce up its majority interest in NBC Universal Inc. Coincident with that decision -- if not actually contributing to it -- would be recognition of a NBCU-Time Warner union as compelling. The synergies wouldn't extend just to the studios, Warner Bros. and Universal Pictures, but to broadcast news operations. Many Warner Bros.-produced television shows already have a home on NBC, thus making a combination all the more enticing."

In October, NBCU chief Jeff Zucker again tried to dispel rumors GE's media business was on the block. Dealscape's Matt Wurtzel noted:

While speaking at a media conference in New York on Monday, Zucker dismissed repeated rumors that the media company would be sold, saying GE chief executive Jeff Immelt had been "very clear" about NBC Universal's role within the company, according to various news reports. The rumor has floated around for the last two years, but most recently was stoked by a Financial Times article suggesting a deal would happen after the 2008 Olympics.

And analysts haven't been shy in pointing out its problems, its drag upon the rest of GE and calling for a sale or spinoff of the business. More broadly, in late April 2007, The Deal's Lou Whiteman noted:

Citigroup Inc. analyst Jeffrey Sprague in a research note wrote that the sprawling conglomerate is being penalized by the markets for its complexity. ... Sprague in his note recommends GE spin out its NBC-Universal media unit, its GE Money finance arm and its $53 billion real estate portfolio. The remaining company, which would still have an estimated $125 billion in 2007 sales, would be more focused on designing and manufacturing products for industries including health care, transportation, energy, security and water purification.

In terms of restructuring, GE did divest its plastics business to Saudi Basic Industries Corp. for $11.6 billion in May 2007 and is auctioning its $7.2 billion appliances unit. On NBCU specifically, Morgan explained in 2007 it's "bottom-tier" among GE units and pointed out that in 2006 Immelt admitted NBCU was only a 70% fit with GE, which means probably a lot less of a fit. But, he argued, NBCU is crucial to GE's international plans:

What Immelt has also sorted through is NBC's importance to GE's profile in China and, in turn, China's importance to GE's future. NBC is the Olympics' official U.S. broadcast partner -- the Beijing Games will be its 10th Olympics broadcast of a 13-games run -- and in 2005 it brought its parent aboard the biennial party as a worldwide Olympics sponsor.

The sponsorship initially had GE providing power for Olympic villages during the 2006 Games in Torino, Italy. But it's in Beijing, which according to GE "is spending over $40 billion on new subway lines, airport terminals and other infrastructure developments" in preparation for the Olympics, where the sponsorship promises huge dividends.

Put bluntly, GE plans to double its $5 billion in annual sales from China by 2010. And it's hoping the $500 million it's investing in more than 300 projects tied to the Beijing Olympics will serve as a showcase not only in China but for other emerging markets."

A BROAD VISION

That international focus is also a cornerstone of NBCU's focus. The company May 28 said it had closed on a $150 million investment in Indian broadcaster NDTV Networks plc, which gives it an indirect 26% stake and an option to increase it to 50% in two years. The Deal's Richard Morgan in January wrote: "The partnership marks another milestone as NBC Universal pursues the April 2007 pronouncement of its president and CEO, Jeff Zucker, to double the size of its international operations within three years."

NBCU further expanded abroad in August 2007 with a deal -- reportedly worth about $350 million -- for Sparrowhawk Media Group, from Providence Equity Partners Inc., 3i Group plc and management. Sparrowhawk controls "the 18 international feeds of the Hallmark Channel, which air across 152 territories to more than 60 million subscribers in Africa, Asia, Australia, Europe, Latin America, the Middle East and the U.K."

THE WOMEN'S ANGLE

One segment NBCU has gone after aggressively is women. The company picked up Oxygen Media LLC in October 2007 for $875 million. Oxygen, which was founded in 2000, was backed by Paul Allen through his Vulcan Capital, Oprah Winfrey and television producers Marcy Carsey, Tom Werner and Caryn Mandabach. On the deal at the time, Morgan noted that many watchers believed:

Oxygen is likely to take such NBCU investments as iVillage and Sparrowhawk Media Group to their next levels as well. NBCU acquired the former, a female-oriented Internet portal, last year for $600 million; it picked up the latter, which manages and controls 18 international feeds of the Hallmark Channel, in August for an amount a source put between $250 million and $300 million.

And it all winds back, again, to GE and NBCU's international plans. Morgan noted:

NBCU said the purchase of Oxygen will be "substantially self-funded" by the sale of two of its Spanish-language TV stations: the first is one of three NBCU-owned stations in Los Angeles, which is being sold to bring NBCU's TV station group into regulatory compliance; the second is in Puerto Rico, reflecting a recent decision to focus on NBCU's owned-and-operated TV outlets. Despite the assets selected for sale, Zucker insisted they do not diminish NBCU's commitment to the U.S. Hispanic population, which it began serving in 2002 after acquiring Telemundo Communications Group Inc. for $2.7 billion."

CAST OF CHARACTERS

The Deal's Amy Wu spoke in February with NBCU's longtime dealmaker Bob Wright, who oversaw the 2003 GE-Vivendi deal as NBCU chief. Wright took his leave from GE in April with plans to move to Lee Equity Partners LLC.

In 1986 [Jack] Welch tapped [Wright] to run NBC, which GE had picked up as part of the acquisition of RCA Corp. for $6.4 billion. At NBC, Wright led dozens of acquisitions including the Australian Television Network, the Financial News Network, launching NBC Asia, partnering with Microsoft Corp. to launch MSNBC in 1995 and, of course, the big Vivendi deal to form NBC Universal.

Wright left NBC Universal and settled in back at GE. A little over a year ago, he received a call from Lee, who asked him to join his new venture, but he says the timing wasn't right yet.

Meanwhile, Morgan told us in 2007, at year's end Steven Spielberg would leave Paramount Pictures Corp. and return to Universal Pictures.

General Electric Co.'s NBC Universal Inc. will then hail the return of the famed director and creative linchpin of DreamWorks' live-action studio, which will remain with Viacom Inc.-owned Paramount. Viacom's response will be to repeat the claim -- initially uttered by CEO Philippe Dauman at Goldman, Sachs & Co.'s recent Communacopia conference -- that the exit is "immaterial." ...

Wright, who stepped down as NBC U's chairman in May, reportedly let Spielberg slip away in the first place by trying to shave $100 million off a $1.5 billion handshake agreement to acquire DreamWorks LLC in October 2005."

But, could a movie venture with India's Reliance ADA Group Ltd. lure him instead?

NBCU, GE COMMERICAL FINANCE DO VC

And, like most large media players, NBCU alongside GE's commercial finance arm, publicly got into the strategic VC game in April 2007 with a $250 million fund -- well after the entree and establishment of several peers. Morgan wrote:

By targeting "developing technologies, platforms or business models with a strong strategic fit with NBC Universal" -- then paying up to $15 million for each opportunity that passes muster -- the General Electric Co. units are playing catch-up with other conglomerate-size strategics. Among existing entries are Time Warner Investments, which began life as the venture capital arm of America Online Inc.; Steamboat Ventures, which the Walt Disney Co. founded in 2000 but kept from investing until 2002; and Comcast Interactive Media, which the largest U.S. cable company set up in 2005 to, in its words, "develop compelling online interactive services."

Their first investment likely handed them a tidy profit: a $3 million investment in Adify Corp., unveiled in April 2007, about a year ahead of its $300 million sale to communications giant Cox Enterprises Inc.

There have been others, like video game ad network IGA Worldwide.

OTHER INTERESTS

In July 2007, Corporate Dealmaker's Suzanne Stevens noted that News Corp. and NBC Universal were working on a joint venture for online distribution of entertainment content, including full-length television programs and clips, and feature-length films. Later named Hulu, content partners include Time Warner Inc.'s AOL LLC, Microsoft Corp.'s MSN, News Corp.'s own MySpace, Yahoo! Inc., Comcast Corp., CNET Networks Inc., Oxygen, the Sundance Channel and TV Guide.

Earlier in 2007, GE and Microsoft also got together to discuss combining Dow Jones & Co., at least in part with NBC Universal, though talks fell apart. (The Wall Street Journal publisher ultimately went to Rupert Murdoch's News Corp.)

And back in September 2006, Corporate Dealmaker talked with NBCU's EVP of biz dev Bruce Campbell on NBCU's venture with ION, Scholastic, Corus Entertainment and Classic Media/Big Idea, to form multiplatform children's network Qubo. The impetus behind the deal, he said, was to use ION's spectrum to "meet an underserved need for educational kids' programming," and maximize growth "by providing weekend mornings on the NBC Network and on Telemundo."

OTHER SIDE OF THE DEAL TABLE

Cablevision Systems Corp. on May 7 unveiled plans to acquire the Sundance Channel for nearly $500 million from NBCU, which held 57%, CBS Corp.'s Showtime Networks, which had a 37% stake, and the channel's founder Robert Redford, who held 6%.

Meanwhile, ION Media Networks Inc. unveiled a going-private recapitalization agreement in May 2007 with NBCU and Citadel Investment Group LLC, which had been in the works for months. Morgan offers the backstory:

In 1999, after investing $415 million in Ion (then named Paxson Communications Corp.), the Peacock network was expected to acquire all of the West Palm Beach, Fla.-based TV station group. Instead, NBCU wound up buying Telemundo Communications Group Inc. in 2001, an acquisition that pushed its station holdings to their regulatory limit. Relations between NBCU and Ion then turned contentious until an agreement reached in November 2005 not only removed Paxson as Ion's CEO but replaced him with Peacock executive Brandon Burgess. While that rift is now repaired, a new one that has a group of preferred shareholders squaring off with Ion, NBCU and Citadel appears almost as rancorous."

EVOLVE OR BE GONE

In terms of NBCU's recent evolution: First, the wildly-popular sitcom "Friends" ended its 10-year tenure on NBCU's flagship station, NBC. Then the company bought women's online portal iVillage for $600 million. And then Katie Couric fled the station and its softball-ish morning news show "Today" to be the queen and anchor of CBS' hard-news 6:30 p.m. evening broadcast. The company appeared at the time to be gearing up for job cuts and a stronger push toward the Internet. NBC Universal, which is 80% owned by General Electric Co. and 20% owned by Vivendi Universal SA, unveiled a restructuring initiative Oct. 19, 2006 titled "NBCU 2.0."

• The plan was to cut costs by $750 million and slash 700 jobs by the end of 2008.
• NBC said it would shutter its MSNBC headquarters in Secaucus, N.J., and cram the cable news station's operations into existing facilities in Manhattan and Englewood Cliffs, N.J.
• And also last year, Microsoft restructured its 50-50 joint venture with NBC Universal and trimmed its ownership to a minority share and gave NBCU the option to take 100% ownership within the next two years.
• The company also planned to cut its real estate in L.A. by creating consolidated news facilities in Burbank and hold reviews at news bureaus around the world.

In its statement Oct. 19, 2006, the company said it expected digital revenues would exceed $1 billion by 2009 and that it attributed recent growth to a partnership between Yahoo!, as well as Telemundo. The company also pointed to the launch of NBC WeatherPlus, nbbc, nbcsports.com, cnbc.com, and dotcomedy.com.

Giving in to the 2.0 way of life, in December 2005, NBC said it would offer 11 shows for download on Apple's iTunes for $1.99 a pop the day after they air, and in June 2006, CBS followed suit and did the same with "CSI" and" Survivor." In February 2006, NBC signed a deal with Aeon Digital to license its own programming for on-demand viewers via the Internet. Also in June 2006, NBC made a deal with YouTube to upload promotional content to its site -- months after alleging copyright violations and demanding the YouTube remove clips from NBC shows posted by users.

NO NEWS IS BAD NEWS

The restructuring was also ominous, The Wall Street Journal pointed out: "NBC's restructuring plan also makes it the first major TV company to say that it sees limited growth potential in the news business."

But change was in the air, most notably at CBS Corp., which split from former-parent Viacom Inc. in January 2006 and re-honed its focus from the top down, with CBS president and CEO Les Moonves. The Deal's Richard Morgan wrote in May 2006:

At CBS Corp., Les is move. Move past mistakes. Move out of noncore competencies. And move beyond the "Via-Slow" expectations assigned to CBS Corp. when separated from its "Via-Grow" half at the beginning of this year.

• CBS paid $71.5 million for supermarket broadcaster SignStory Inc. in 2007.
• CBS in March 2007 said it would sell off seven TV stations to PE firm Cerberus Capital Management LP for $185 million.
• The company began shopping radio stations in 10 of its smaller markets in May 2006. In late August, CBS sold $262 million worth of stations to Entercom Communications Corp. and weeks later sold its Buffalo, N.Y., operations for $125 million to Regent Communications Inc. Earlier in October, CBS sold four FM radio stations to Wilks Broadcast Group LLC for $138 million.
• CBS sold its Paramount Parks Inc. to amusement park operator Cedar Fair LP in May 2006 for $1.24 billion in cash.
• And kicking off January 2006, CBS combined its UPN station with Time Warner Inc.'s WB station to create CW, which launched that September.

LOOKING AHEAD

Though GE hasn't unveiled plans to sell or spin off NBCU yet, it's not the only party with a say. Rounding out 2006, Vivendi agreed not to exercise its right to exit NBC Universal in January 2007 but would keep its stake at least through November 2007, Morgan wrote:

NBC Universal was created by the $43 billion merger of Vivendi Universal Entertainment and GE's NBC division in May 2004. Vivendi's right to demand an initial public offering of NBCU or receive fair market value for its stake can now be exercised in November each year from 2007 to 2016. Conversely, an option for GE to reduce or eliminate Vivendi's stake can now be done in May each year from 2011 to 2017, with a floor price of $8.3 billion that will increase each year from May 2009. Vivendi's limit on the amount of NBCU stock it can cash out the first year was boosted to $4 billion from $3 billion, but remains at $4 billion afterward.