Mikey Campbell
AT&T on Tuesday received the green light to move forward with an $85 billion deal to buy media giant Time Warner, bringing an end to a contentious antitrust lawsuit leveled by the U.S. Justice Department last year.
In a ruling handed down by U.S. District Judge Richard Leon, AT&T is allowed to acquire Time Warner and take control of its substantial cache assets with no conditions applied to the sale, reports CNBC.
The deal will give the telecom full control over Time Warner's cable channels, which include CNN, TBS and HBO, and film studio Warner Bros. AT&T intends to complete the merger by June 20, one day prior to the deal's expiry.
In late 2017, the DOJ sued to block AT&T's merger bid over concerns that the combined entity would pose a "major" threat to competitors. Specifically, the government argued three main points relating to leverage over industry rivals, potential harm to streaming services and possible access restrictions imposed on certain cable channels.
Leon found for AT&T on all claims, saying the DOJ failed to meet the burden of proof that the acquisition would result in fewer choices for consumers and higher prices for content providers. The jurist also warned against an appeal, an option for the Justice Department after the six-week trial.
"I hope the government has the wisdom and courage" not to seek a stay, Leon said, according to CNN.
AT&T, which owns satellite TV service DirecTV, initially announced intent to buy Time Warner in 2016. An unconventional merger, AT&T said it seeks not only to diversify revenues, but also bolster its streaming operation by bundling entertainment offerings with mobile services. The company currently provides similar incentives with DirecTV.
Leon's decision is expected to spur a wave of similar merger attempts likely to raise the DOJ's hackles. Comcast, for example, is looking to disrupt Disney's announced deal with 21st Century Fox with a bid of its own.
Prior to the merger announcement last year, Apple was rumored to have held preliminary talks with Time Warner over a potential tie-up, but those discussions failed to bear fruit.
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40 Comments
Just in time for the death of net neutrality! Buckle up and let's see what's going to be the first abusive move and how congress wont do anything to protect the people...
This is bad for a heap of reasons other than the repeal of net neutrality. It is never a good idea to impose Regs based on fears of what might happen. Repeal was the right thing until there is decent evidence the dead hand of regulation is necessary.
People with skills in building pipes are no good at making what goes through them. The same reason Apple TV shows have been lame to date. Expertise in computing doesn’t translate well into arts.
ATT hopes it can boost depressed price of TW ad impressions by better targeting. I’m a target, but now that Direct TV Now has 20 hours storage free DVR cloud in beta, you can skip through ads (in 15 sec jumps) in recorded shows. So far, I’m liking it, a deal for $20 month since it’s tied into my cell plan.
This will fine for AT&T, but I'm not so sure it's going to be good for Warner Bros. Over time, I can see AT&T putting the kibosh on anything that doesn't make money, so they'll be fewer film restorations, etc. I can see AT&T killing TCM. And since they'll be primarily interested in streaming content, I can see them releasing fewer and fewer Blu-ray and UHD discs. WB just announced that they're going to do a new series of Looney Tunes cartoons with the classic characters. I could see AT&T killing this as well.