NBC Universal, which is a part of GE (NYSE: GE), has apparently agreed to shell out $3.5 billion for the Weather Channel. The deal involves a partnership with two marquee private equity firms: Bain Capital LLC and Blackstone Group LP (NYSE: BX).

The transaction has weathered the credit crunch -- as well as survived a gestation period that has gone on for most of 2008. But, in the end, it looks like NBC got a nice deal (keep in mind that it looked like the Weather Channel tried to snag $5 billion or so).

The Weather Channel has extensive distribution (#3 in the US). What's more, there will be synergy with NBC's digital weather property, Weather Plus. Oh, and NBC has lots of experience integrating cable companies, such as Bravo and Sci Fi.

Although, perhaps the most important part of the deal is weather.com, which gets 36+ million unique visitors per month. This ranks it as the #15 site on the web. No doubt, NBC can leverage its advertising -- as well as other websites -- across this virtual real estate.

Finally, the Weather Channel transaction points to a possible new model for private equity; that is, partnering with strategic buyers. It's a good way to deploy capital but also get cost/revenue synergies.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

For every person who had to wait forever for Time Warner Cable, Inc. (NYSE: TWC) to pick up the phone, for every customer who had to slog through an automated voice menu, then stew waiting to talk to a person, for every family that went days without TV or internet, Los Angeles City Attorney Rocky Delgadillo struck a blow Friday. On behalf of the city of Los Angeles, Delgadillo sued the top cable provider for southern California, saying its service was so bad it constituted fraud and deceptive advertising.

The city wants $2,500 for each instance, double if the victim was old or disabled. Part of the problem in Los Angeles stemmed from the company's complicated task of absorbing Comcast and Adelphia customers, not everyday business. Consumers had filed their own civil suit a while back.

Time Warner Cable stock dropped $1.23, or about 4%, Friday on somewhat heavy trading. The damages could add up to potentially millions of dollars. Or it could be one of those lame settlements that give customers useless coupons.

The direct impact of the civil suit isn't as much of a big deal -- yet -- as the broader implications. What if other cities or customers sue? How is this suit going to influence the opinion of someone who's deciding between Time Warner and Dish Network or DirecTV? Between Roadrunner and wireless broadband? For a long time, cable providers could offer lousy service because there was basically no competition. Now, they have to behave better or lose customers. Now that could be real money.

The Associated Press reports that News Corp.'s (NYSE: NWS) Fox News Network plans to launch Fox Business Network (FBN) to compete with General Electric's (NYSE: GE) NBC Universal's CNBC on October 15. Will the two really compete? CNBC targets upscale investors while FBN says it's targeting Main Street.

One interesting detail in this article is that Dow Jones & Company's (NYSE: DJ) arrangement with CNBC -- giving it exclusive access to the Wall Street Journal until 2012 -- only covers business-related news. This allows FBN to use Journal coverage of other areas such as Washington and lifestyle topics.

I think CNBC will feel threatened by FBN and continue to respond by offering conservative-leaning and big-business-boosterish coverage. Meanwhile FBN will use its well-practiced brand of Amen Chorus stories that both demonize the enemy -- in this case CNBC -- while appearing to support the voiceless, powerless little guy. If I ran CNBC, I would focus primarily on giving my core audience more of what it wants and not try to imitate FBN through patriotic-sounding stories.

Advertisers will pay a premium to access CNBC's upscale viewers and GE cannot afford to lose those dollars.

Peter Cohan is president of Peter S. Cohan & Associates,. He also teaches management at Babson College and edits The Cohan Letter. He owns GE stock, has consulted to News Corp.'s CEO, has appeared as a guest on CNBC and Forbes on Fox, and has no financial interest in Dow Jones.

Walter Cronkite is coming back. I know you've been holding your breath since he retired in 1981, but it's OK. He is expected to take a job as an anchor on a cable network called Retirement Living TV. Florence Henderson is also on the network. Sounds like a recipe for a ratings blockbuster.

The network celebrated its one-year anniversary last week, and only has coverage on DIRECTV Group Inc.'s (NYSE: DTV) network for 8 hours a day. It is also broadcast on Comcast Corp.'s (NASDAQ: CMCSA) CN8 for 4 hours.

Retirement Living bills itself as "the new voice of a generation underserved by the media industry. We hope to change not only the way you watch TV, but the way you live your life."

But the question is whether seniors really want to watch "old people TV". My grandmother likes to watch CNN and E! to keep up with the latest celebrity gossip -- makes her feel young. In a society with such an emphasis on youth, are Florence Henderson and Walter Cronkite really a good way to attract seniors?

So far the network has failed to catch on big, and I don't expect it will.

Back in December, I wrote about the difficulty that the NFL Network was having in getting off the ground. Last season, the network made 8 games available exclusively on the network hoping that it would spur fans to call their cable operators and demand the network. But it didn't happen.

According (subscription required) to The Wall Street Journal, Time Warner Cable (NYSE: TWC) and Cablevision are refusing to carry the network. Comcast (NYSE: CMCSA) has pulled the NFL Network from millions of homes and the NFL sued, lost, and is appealing. The league has even set up a nice astroturfish website to make its case to the public.

The NFL has had a difficulty relationship with networks, who feel that they are being gouged. Many industry observers view the NFL Network as an effort to say to ABC, ESPN, FOX, etc. "We don't need you. We can do this ourselves if we want." This may be more about leverage in contract negotiations than actually establishing the NFL Network as a viable station.

Of course, that will plan will backfire wonderfully if they can't get cable operators to carry it.

Liberals from the coffee houses of Cambridge to the wine bars of San Francisco cackled with joy when they learned that Fox News had shelved the 1/2 Hour News Hour, the News Corp.'s (NYSE: NWS) channel's clone of The Daily Show.

As TV Newser points out, Fox Senior Vice President Bill Shine told staff in a memo that. "There is still a chance you will see the program at some point in the future." The Web site pointed out that the program had its fans, winning its timeslot all but once.

So, why cancel it then?

The anonymous folks on TV Newser's discussion boards certainly didn't find it amusing and suggest that its ratings plunged after an initial spike. The clip I heard on Fox's Web site, which doesn't provide any links to the show on its home page, didn't tickle my funny bone. Neither did the clip on YouTube featuring the always amusing Rush Limbaugh as president and Ann Coulter as vice president.

Jon Stewart probably didn't lose too much sleep worrying about this show.

Fret not conservatives, comedy hasn't died completely on Fox News. Those hysterical cutups Sean Hannity and Bill O'Reilly aren't going anywhere. I'm sure that Neil Cavuto will keep the laughs coming on the yet-to-be launched Fox Business Network.

Maybe Fox will replace 1/2 Hour News Hour with Red Eye with Greg Gutfeld. Red Eye routinely wins the coveted 2 a.m. drunk/insomniac timeslot. Gutfeld is conservative, goofy and at times pretty funny. His program deserves a spot in your DVR though it too isn't on Fox News' home page.

News Corp.'s (NYSE: NWS) Fox News channel received praise from an unlikely source: former CNN anchor Aaron Brown.

In an interview with TV Newser, Brown described Fox as "very disciplined, ratings-directed news organization, or whatever they are" and CNN as "an organization that is trying to figure out if it can be all things to all people."

Though Brown is bitter about his departure from the Time Warner Inc. (NYSE: TWX) network, he does have a point. Fox didn't only win the cable ratings war because of politics. It hired better broadcasters and put out more memorable shows. Roger Ailes figured out early that people tune into cable expecting opinions and that's what Fox gave them.

CNN has fought back though, adding blowhards such as Glenn Beck and Nancy Grace, CNN Headline News does decently in the ratings. Lou Dobbs' crusade against illegal immigration also has resonated with the public, which is kind of scary. It's also scored its share of scoops including Larry King's Paris Hilton interview. (Yeah she's horrible, but people are interested).

Faced with a growing controversy over its $1 million stock-picking contest, General Electric Co.'s (NYSE: GE) CNBC did what companies faced with a crisis always do: release a cryptic statement late on a Friday announcing how it plans to clean up the mess.

In CNBC's case it's the hiring of Stanley Sporkin, a former federal judge, former CIA general counsel and former SEC enforcement director along with computer security firms Symantec Corp. (NASDAQ: SYMC) and KSR Inc.'s Neohapsis.

CNBC obviously would like the public to forget how badly it botched "The Million Dollar Portfolio Challenge." BusinessWeek uncovered evidence of cheating that was patently obvious as contestants took advantage of a software flaw. This promotion helped push CNBC.com to become one of the top sites for business news.

But the cable channel is pressing on with the promotion. The company was supposed to declare a winner on July 8, but has vowed not to do so until the investigations are complete. CNBC's problems may not end there.

BusinessWeek reported that finalist Joe Dondero, who didn't take advantage of the software flaw, has been accused of manipulating trading in thinly traded equities in the real stock market to enhance his performance in the contest. He also has a track record of getting in hot water with regulators, including the NASD, the magazine said.

CNBC's attempt to sweep this fiasco under the rug is unfortunate. The channel did the right thing, though, by hiring outside consultants to investigate what happened and hopefully will learn how to avoid future mishaps like this in the future.

At this point, the network should follow the lead of my former employer TheStreet.com, which scrapped a similar promotion after cheating was discovered. These contests are bad ideas anyway.

The last thing investors need is encouragement to chase short-term profits

Penning the series finale to a beloved show is a thankless job. A program's resolution is never quite good enough, and always leaves fans feeling disappointed, cheated, or flat-out angry (one notable exception, in my opinion, was the final offering of Newhart). Creator/writer of The Sopranos, David Chase, apparently couldn't please his rabid army of fans hungry for a fitting end to their favorite Mob family.

After the final curtain was drawn yesterday evening on the sixth and final season of the beloved series, angry fans began to stalk the HBO website. Countless letters of strongly-worded outrage at the show's less-than-fulfilling outcome (I won't post any spoilers here) ultimately crashed the site of the cable network, which is a unit of Time Warner Inc. (NYSE: TWX).

The Sopranos, which centers on the life of Tony Soprano (the inimitable James Gandolfini) as he balances his home life with his responsibilities as a high-ranking official in the world of organized crime, is the final of HBO's cash cows to bid adieu. While Entourage and Big Love are critically acclaimed, they do not attract the ratings of Sopranos (or former success story Sex and the City).

The Sopranos finale evidently angered so many viewers that some analysts are predicting a rapid spike in cancellations of the premium service, which costs about $10 to $15 each month, depending on your cable provider.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.

Verizon Communications Inc. (NYSE: VZ) is the Rodney Dangerfield of telecommunications stocks: it doesn't get any respect.

The company's shares have risen less than 2 percent this, year underperforming other major telecom providers including AT&T Inc. (NYSE: T), Sprint Nextel Corp. (NYSE:S) and Qwest Communications International Inc. (NYSE: Q).

Perhaps, investors are turned off by the company's FiOS upgrades, which as the company's better-than-expected first quarter results indicates, are starting to pay off. This progress doesn't appear to be reflected in the stock price, which barely budged following the earnings report.

Verizon Wireless added 1.7 million customers in the first quarter, beating AT&T, according to Bloomberg News. The company also had a lower churn rate than AT&T and added more fiber customers than its rival.

Even Wall Street thinks Verizon's strategy is better.

"AT&T is looking to keep everything. For the near term, AT&T is seeing the benefits," Standard & Poors analyst Todd Rosenbluth told the Wall Street Journal (subscription required) "A year or two out, we think that what Verizon is doing, while not cost effective, is a better approach towards fighting cable competition."

Meanwhile, Verizon's valuation is pretty attractive.

Its trading at a forward price-to-earnings ration of 14.7, in-line with the 14.6 multiple for AT&T and cheaper than the 24.6 ratio for Sprint and 27.8 for Qwest.

The discount seems out of whack with reality.

Time Warner Cable (NYSE:TWC) was started today with a HOLD rating by Citigroup. The analyst report suggests there is little upside and little downside to current prices. The target price is $42.00, which is actually about a12% return. Simultaneously, the risk factor is set as Medium Risk.

Citigroup notes a premium valuation to peers already discounts EBITDA margin expansion. The good news is that Citigroup sees little downside risk from Verizon Communications' (NYSE:VZ) FiOS and AT&T (NYSE:T) as there is only a 3% overlap in their coverage footprints. The analyst also notes that TWC is "not expected" to acquire Cablevision Systems (NYSE:CVC) because of FiOS risks in NYC and New Jersey.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.

Comcast Corp. (NASDAQ:CMCSA) is unhappy with the search advertising deal it has with Google Inc. (NASDAQ:GOOG) for its broadband portal and is chatting up Microsoft Corp.'s (NASDAQ:MSFT) MSN service, according to the Wall Street Journal (subscription required).

The no. 1 cable company is unhappy with the terms of its current deal with Google and wants a larger share of the advertising revenue, the paper said, adding that Comcast.net is one of the biggest sources of Google search queries from outside the company.

There's isn't anything unusual about the Comcast-Google situation. I'm sure Google is involved in lots of contract negotiations like it. What's weird is that the Comcast dispute got publicized. Why Comcast trying to send Google a message via the Journal?

Though this deal isn't significant for the bottom line of any of these huge companies, it's worth monitoring. My colleague Tom Taulli correctly points out that Google is starting to show vulnerabilities and that search has the potential to become a commodity.

Google doesn't want to give up traffic to any competitor, especially MSN. Microsoft is probably the only company that can break the zen-like calm of Google's management.

The Philadelphia-based company wants to boost its Web presence, which includes sites like Eonline.com, as competition for television and broadband internet services heats up. Microsoft wants to establish credibility in search to rebut critics who claim the company is pouring billions into a foolish quest to catch up to Google.

So there's lots of pride and ego at stake here. It will be interesting to see how things work out.

Following a beta-test in Hawaii, Time Warner Cable is launching PhotoShow TV. This version of the SimpleStar software product will allow subscribers of Time Warner's digital cable TV service to share personal photos and video clips with other subscribers for free. They'll also be able to post these items onto the video-on-demand service.

I don't know anyone who uses these kind of web/television tools, but seems a good resource and may pique the interest of those who don't want to bother signing up for Flickr -- or whose network of family and friends is more television- than web-oriented. As long as everyone you want to share photos with also has digital Time Warner Cable, you'll be fine. Works with Windows Media Center PC, Windows XP, and Xbox 360.

Michael Canfield is a private investor, a business and media writer, living in Seattle. He doesn't own stock in Time Warner.

Time Warner (TWX) wanted to ditch the NFL Network on some of the cable television markets they recently obtained out of the Adelphia bankruptcy. The FCC didn't like that, or at least wanted to mull it over, so told Time Warner that they must continue running that network for 30 days while the matter is looked into. Well, Time Warner didn't like that, and appealed the ruling they be forced to continue running it, even for such a brief interm, calling it "forced speech" to make them do so!

So for Time Warner this is a First Amendment issue! The FCC sees it, more prosaically, as a customer service issue, and for the moment, cable customers will get what they paid for under Adelphia because Time Warner lost this appeal, with the FCC saying: "We believe that on balance the granting of interim relief is warranted."

Michael Canfield is a private investor, a business and media writer, living in Seattle. He doesn't own stock in TWX.