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Parsons: This is why media M&A is on pause

Media companies have "hit the pause button" on mergers until a decision comes down on two major deals, former Time Warner chairman and CEO Richard Parsons told CNBC on Friday.

Those buyouts are Comcast's bid for Time Warner Cable and A&T's pending purchase of DirecTV, both of which must receive approval from the Federal Communications Commission.

Media companies "want to see what the FCC does with these things. Are they going to follow the president's lead? Are they going to go in a whole new direction? Are they going to try to carve out something in the middle? People want to see what kind of conditions are being put on these things," he said in a "Squawk Box" interview.

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The reason mergers and acquisitions activity has been muted is FCC Chairman Tom Wheeler is trying to figure out how to chart a course, Parsons said. There will likely be conditions imposed on the deals, but they will probably not be insurmountable, he added. As a result, both deals could get done by the second quarter.

After a decision comes down, Parsons believes a domino effect will kick off, sparking more M&A activity.

The idea of a merger between CBS and Time Warner is "almost compelling" and could happen one day, Parsons said.

Parsons was responding to comments from former CBS CEO Mel Karmazin, who told "Squawk Box" on Thursday he would invest his own money into a combination of the two media companies if one were to materialize.

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"When I was [at Time Warner] we looked at some kind of combination with broadcast network, CNN being the primary driver. But also you have to think of Warner Bros. as a factory. They produce content. Then what you need is distribution. Big broadcast networks distribute content. So it makes a lot of sense on paper," he said.

Casting doubt for a moment, he said, "How many deals get done just because they make sense?"

As a stand-alone channel, CBS would need Time Warner more than Time Warner needs CBS in such a deal, he said.

Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.