Comcast and Time Warner Cable are preparing to meet with Justice Department officials this week to discuss competition concerns over their planned $45 billion merger, a source familiar with the situation confirmed to CNBC.
The meeting Wednesday, first reported by The Wall Street Journal, would aim to negotiate possible concessions addressing those concerns. The paper said it would be the first time the two cable giants have met with regulators since announcing their proposed deal a year ago.
Staffers at the Justice Department and the Federal Communications Commission remain concerned the combined company would have too much power in the Internet broadband market, and would have unfair competitive leverage against TV channel owners and businesses offering online video programming, the Journal said.
"It's not the total number of broadband subscribers, which is a problem for the government. ... [It's] control of the most important markets," BTIG media and technology analyst Richard Greenfield said Monday.
"The government is going to want something very substantial to approve," he said in an interview on CNBC's "Squawk Box," speculating about a possible demand to divest the New York and Los Angeles markets, "which is the whole point of the transaction."
"Remember [there's] no breakup fee. So Comcast could walk," said Greenfield, but added that Comcast won't sit still. "What are they going to buy if they don't buy this? Do they go wireless? Do they go Europe? Do they go in enterprise? Comcast is not going to just sit around."
Comcast owns NBCUniversal, parent company of CNBC.
Representatives of Comcast and Time Warner Cable and the Justice Department did not immediately respond to requests for comment.