NAAOM VS Comcast Lawsuit a Sham?

Time_Warner_Cable__Comcast__Al-e19d7005fea8dd8f88d9979045842d52

Comcast Corporation, the largest broadcasting and Cable Company in the world, is currently in the midst of a potential racial lawsuit filed by the National Association of African-American Owned Media (NAAOM). Allegations directed towards Comcast have also been extended to Time Warner Cable, a company which (pending a ruling by the Federal Communications Commission) will soon be merged with the Comcast Corporation. The lawsuit accuses both Comcast and Time Warner Cable of spending an annual $25 billion on service and product advertisement, while only allocating $3 million annually to 100% African-American-Owned media.

Thinking about this allegation critically, how many 100% African-American-Owned media businesses are there really? Considering the United States’ incredible diversity I find it hard to believe that there are, by proportion, enough media companies solely owned by men and women of African descent to warrant spending considerably more than 12% of a $25 billion advertising budget.

Just to be sure, I did some research. I visited BlackEnterprise.com, the official website of the highly successful magazine “Black Enterprise”, which describes itself as a “premier business news and investment resource for African Americans.” Black Enterprise (BE) keeps track of the nation’s largest, most successful, black businesses and compiles them onto a list called the “BE 100s.” They do a great job at analyzing all these businesses as a whole and determining the businesses leading in growth, employment, by annual trend, and by industry. I examined the sales of all these top businesses by industry and found that out of a total $29,808 million in sales, a measly $154 million derived from “Telecommunications.”

Let’s put this in perspective: In 2010, the total US Telecommunication Industry Revenue was $985 billion, and since then it has only increased. Can Comcast, the biggest Telecommunication Industry in the country, really be blamed for being market-conscious investors? Is it unreasonable to assume that a corporation, which for six consecutive years was named one of the “Top 50 Organizations for Multicultural Business Opportunities,” was allocating resources based on viewership statistics rather than race?

This is not the NAAOM’s only controversial lawsuit; the organization has also filed a $10 billion lawsuit against AT&T and DirecTV for discrimination in their contracting services. The NAAOM alleges that when considering African Americans make up 13% of the US population, AT&T has not contracted to enough 100% African-American-Owned Media companies…but last time I checked, corporations don’t contract/hire in accordance to the racial distribution in the US. This implies that AT&T should make sure 72% of their contractors are White American, and that 5% of their contractors should be Asian American! That doesn’t seem right to me…

What it does seem is that the NAAOM’s claims are poorly supported and unfounded. While this is only my humble opinion, I do welcome more discussion on the topic. Please respond with your thoughts!

-Alexander Santos

http://corporate.comcast.com/images/Comcast_Diversity_booklet_2012.pdf
http://www.columbia.edu/cu/consultingclub/Resources/Telecommunications_Pablo_PrietoMunoz.pdf
http://www.blackenterprise.com/lists/be-100s-2014/
http://www.broadcastingcable.com/news/washington/naaom-seeks-more-diverse-contracting-attdirectv/136115

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