WASHINGTON (Reuters) - The U.S. Federal Communications Commission's staff has recommended that the agency designate Comcast Corp's (O:CMCSA) proposed $45 billion (29.95 billion pounds) acquisition of Time Warner Cable Inc (N:TWC) for a hearing, the Wall Street Journal reported on Wednesday, calling it a significant setback for the deal.
The recommendation, which would, in effect, put the merger in the hands of an administrative law judge, would be seen as a strong sign the FCC does not believe the deal is in the public interest, the Journal reported, citing people familiar with the matter.
A hearing could be a drawn-out process, and some regulatory experts describe the procedure as a deal-killer, although Comcast would be entitled to make its case for the acquisition, the newspaper said.
Comcast's merger with Time Warner Cable would combine the nation's two largest cable companies, which do not directly compete against each other in any markets. Opponents, however, have particularly focussed on the combined company's broadband market reach, worried about its potential gatekeeping power.
The FCC has to decide that the deal is in the public interest and the Justice Department has to rule that it does not harm competition for the merger to go through.
Comcast has pushed back against criticisms, arguing the deal would bring faster Internet speeds and better video services to more consumers.
