AT&T-Time Warner Merger Gets The Green Light From Federal Court

Angelo Anderson
June 13, 2018

And the AT&T-Time Warner deal is not necessarily yet in the clear.

The ruling is a major setback for the Justice Department and its antitrust chief, Makan Delrahim, whose decision to sue to block the deal broke with convention.

The merger, including debt, would be the fourth largest deal ever attempted in the global telecom, media and entertainment space, according to Thomson Reuters data. For more, RT America's Manila Chan is joined by former Florida Democratic Party Chair Mitch Ceasar and GOP Strategist Ken Del Vecchio. Judge Leon asked in response to a statement about the threat of content blackouts. The DOJ moved to block the merger in March, arguing that the merger would reduce competition and hurt consumer choice.

In addition, T-Mobile and Sprint are direct competitors, so their merger is perhaps more likely to be seen as anti-competitive than a union of AT&T and Time Warner.

At the heart of the DOJ's complaint is an assumption that the merged entity would use its market power to raise the price of content now owned by Time Warner, or threaten to withhold programming, including hit shows such as Game of Thrones and NCAA March Madness. Disney has said that they are prepared to fight to keep a deal in place.

"We are pleased that, after conducting a full and fair trial on the merits, the Court has categorically rejected the government's lawsuit to block our merger with Time Warner".

The deal is what is known as a vertically integrated merger: a joining of two companies that do not directly compete with each other.

Their concerns only grew heightened after Monday, with the official end of federal net neutrality rules that required broadband providers, including AT&T, to treat all web traffic equally - and not prioritize their TV, movie or other content offerings over competitors.


"Compare today to the 50s or 60s when we had three television stations and you had one AT&T that was, then, protected by government monopoly", Crews said.

The US Department of Justice-the nation's antitrust authority-sued to block the deal late a year ago, arguing that Time Warner's media brands like HBO, Warner Bros., and CNN would give AT&T outsized power, hurt competition, and lead to higher prices for consumers.

The decision comes despite criticism from Trump, a frequent detractor of Time Warner's CNN and its coverage.

Comcast's deal is expected to be announced tomorrow.

The deal cost AT&T's top lobbyist, Bob Quinn, his job in May after it became public that AT&T had paid Trump's personal lawyer Michael Cohen $600,000 for advice on winning approval.

The Justice Department must now decide whether to allow the merger to proceed or appeal the decision to a higher court.

Updated 2:18 pm PT: This story was updated with comments from AT&T and the Justice Department.

"This decision will have an outsized effect because there are so few antitrust trials that challenge vertical mergers", said Michael Carrier, a Rutgers University law professor specializing in antitrust.

Other reports by Iphone Fresh

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