AT&T-Time Warner merger approved

Lewis Collier
June 14, 2018

With or without Time Warner, AT&T is very focused on its media business.

Nabila Ahmed, Deals reporter for Bloomberg News covering media and telecom mergers and acquisitions. For more, RT America's Manila Chan is joined by former Florida Democratic Party Chair Mitch Ceasar and GOP Strategist Ken Del Vecchio.

Reading through Leon's unsearchable, uncut-and-pastable PDF file, the same annoying format judges have been using since before the Microsoft case, it's about halfway through that you find the crux of the entire AT&T case. It's widely thought that Comcast may now make a bid for Fox, and that CBS and Viacom may merge. Most immediately, Disney's bid to buy a chunk of 21st Century Fox may be impacted as the ruling could encourage Comcast to put forward a competing bid, as it has already announced it might do. Online companies like Amazon, Google and Netflix have emerged as alternatives to the cable industry both distributing and creating their own content. In a statement, Delrahim said he was "disappointed" in the ruling but stopped short of saying his division would appeal, saying only that it would "consider next steps in light of our commitment to preserving competition".

The Trump Justice Department had sued to block the $US85 billion merger, arguing it would hurt competition in cable and satellite TV and jack up costs to consumers for streaming TV and movies.

He said during the trial that the merger with Time Warner is a "significant shift in strategy" for AT&T, explaining the company knew that smaller acquisitions for content wouldn't work.

In any case, the judge's decision - which could block, allow or approve the merger with restrictions - is unlikely to be the final word.

LOST OPPORTUNITY: NASA's Opportunity rover MIA after dust storm hits Mars
The same swirling dust that blocks out sunlight also absorbs heat, raising the ambient temperature surrounding Opportunity '. But Opportunity has proven to be plucky: Designed for a 90-day mission, it's set to enter year 15 of operation next month.

A vertical merger is when two companies who provide different or complementary offerings join forces, giving consumers access to a more comprehensive set of services, at a lower price, while still generating profits.

Shares in entertainment companies and potential targets of new deals because of Leon's decision rose sharply - CBS shot up about 5 percent and Fox jumped 7 percent in after-market trading on hopes of a bidding war for it between Comcast and Disney. This news comes to us courtesy of The Associated Press.

AT&T originally announced the deal on October 22, 2016, just a few short weeks before Donald Trump was elected president.

The lawsuit against AT&T had sent a signal that the Trump administration's Department of Justice was taking a more hardline stance on such mega-deals.

Now that the merger has been given the go ahead, AT&T will add Time Warner's content to its existing paid TV subscription. That's not to say that vertical mergers get through regulatory approval free and clear - the FTC has fought 22 vertical mergers since 2000 - but they receive less scrutiny than horizontal mergers. AT&T lawyers initially sought email correspondence between Trump's White House and the Justice Department, but Leon declared that any communications were not relevant to the trial, and AT&T relented. AT&T did not immediately respond to a request for comment.

Other reports by

Discuss This Article