Al Sharpton & Comcast/NBC Merger: Another New Conflict of Interest
The reverend’s backing of the Comcast/NBC merger paid dividends for another patron. By Wayne Barrett.
Al Sharpton wasn’t just pleasing prospective employer MSNBC when he became the first major black leader to endorse the controversial Comcast/NBC merger. It turns out he was also enriching his current employer, Radio One, the largest black-owned radio company in the country, which has paid him more money than he’s made anywhere else in his life.
The Daily Beast has already reported that just months after Sharpton played a pivotal role in pushing the merger, he became a regular substitute host and appears now to be in line for a fulltime anchor post on Comcast’s MSNBC. As awkward as that coincidence is, how about a conflict of interest he did not disclose in his letters to the Federal Communications Commission—or his other pro-merger activities?
He was trumpeting a merger that’s already paid dividends to Radio One and its affiliate TV One, which reportedly pay him $700,000-a-year for his six-year-old radio show, commentary, and other appearances on TV One, and occasional blogging on their joint website, NewsOne.
While Radio One is the largest single shareholder in TV One, Comcast has been its partner since TV One’s inception in 2004 and, until recently, held almost as much stock in the television network, 34 percent, as Radio One, 36.8 percent. In fact, Comcast’s role in the launch of this network, which targets a national black audience, was cited repeatedly by the company when questions were raised about its diversity track record during the yearlong debate about this merger.
Alfred Liggins, the chairman of TV One and the CEO and president of Radio One, testified on behalf of the merger at a June 2010 congressional hearing dominated by black opponents of it, led by Congresswoman Maxine Waters and Congressman John Conyers. He said then that Radio One’s holdings in TV One would grow to 66 percent “over the next 12 to 18 months,” but what he didn’t say was that Comcast would help to make that happen. Within a few weeks of the Comcast/NBC approval in late January, Radio One’s ownership of TV One soared to 50.8 percent. Comcast acknowledged in an email to The Daily Beast that it facilitated this stock acquisition, though it said the terms of the deal were “confidential.”
Comcast’s statement to The Daily Beast put some distance between itself and this conveniently timed stock transfer, saying that it was “in no way initiated by Comcast.” That only underlines the benefit that the stock sale was to Sharpton’s patrons, Liggins and his mother Cathy Hughes, who combine to own over 90 percent of the voting shares of the radio company. By virtue of this stock purchase, they were suddenly able to become majority owners of a TV network as well. Comcast’s role, its emailed statement indicates, “was merely to agree to the transaction initiated by TV One.” But Liggins’ testimony, bragging about the coming boost in his holdings, suggests that he got Comcast’s approval for this “amendment to the operating agreement,” as the company’s Securities & Exchange Commission filings describe it, seven months before the merger was approved, yet couldn’t close the deal until weeks of the FCC vote.
So Sharpton was huffing and puffing for his boss.
And that wasn’t all that Radio One/TV One got after the merger. Comcast also moved TV One from digital preferred to digital starter status in Chicago and Miami, making TV One part of its basic package. A TV One spokesperson said in May that, as a result of this change in its status in these two vast markets, “so many more Comcast customers will now have access to TV One.”
Sharpton has actually been much more useful to Liggins and Hughes politically than he has been as a performer. In addition to pushing a merger that may have helped deliver full control of a TV network to them, he joined them in a recent, bombastic campaign against a piece of legislation introduced by Conyers when the Democrats controlled the House that would have required radio stations to pay artists for the songs they play. His TV show for TV One, on the other hand, was a bomb. Called Smart Talk, this barbershop conversation show died after 12 episodes in 2005, unable to attract a large enough black audience. Even though Radio One owns his radio show, Keeping It Real, the network’s Atlanta station dropped it in 2009, reportedly due to paltry ratings, and Sharpton had to find a new home with another network in Atlanta.
Jacob Albert, Bill Kline, Lenina Mortimer, and John Surico contributed reporting for this piece.