A US district judge gave the green light on Tuesday for the mega merger between telecom giant AT&T and entertainment giant Time Warner inc, after a lawsuit was filed by the US government to end it under the belief that the deal would violate US antitrust laws.
Judge Richard Leon of the US District Court for the District of Columbia in Washington DC approved the $85 billion merger with no conditions. The judge’s decision gave a set back to the Trump administration, who expressed opposition to the deal as early as October 2016. Trump vowed at the time that he would push for the deal to end if he was elected.
Judge's approval of AT&T's merger with Time Warner could herald more like it. https://t.co/7E8cmsxLJw
— The Associated Press (@AP) June 12, 2018
“The government is disappointed in the ruling and would consider next steps,” US antitrust assistant attorney Makan Delrahim said. “We continue to believe the ‘Pay-TV’ market will be less competitive and less innovative as a result of the proposed merger with AT&T and Time Warner.”
AT&T first announced the acquisition of Time Warner on October 22, 2016, in which AT&T would acquire properties like Turner Broadcasting which owns CNN & HBO among other cable networks, and the Warner Bros. movie studio.
This merger represents a gross concentration of power that runs counter to the public good. At a time when our telecommunications and media industries are already too concentrated, we should be focused on opening those markets to more competition, not less. https://t.co/7onMq1QMRL
— Bernie Sanders (@SenSanders) June 12, 2018
While the deal was approved by regulators and board members, the Justice Department’s antitrust division didn’t approve the proposal. In fact, Delrahim requestedto AT&T CEO Randall Stephenson that the company abandon the planned acquisition or divest satellite provider DirecTV and spin off Turner Broadcasting. Stephenson rejected the DOJ’s request, calling it an effort by the Trump’s administration to politicize the deal.
An antitrust lawsuit was filed by the Justice Department last November in an effort to stop it. After a six-week long trial, Judge Leon ruled that the US government did not prove that the deal would violate antitrust laws.
The AT&T merger should be finalized by June 20 but the Justice Department could contest today’s ruling in the Supreme Court.
This decision sets a precedent in a rapidly consolidating media landscape, with potential impacts being posed on the proposed mergers between T-Mobile US and Sprint along with Disney & Comcast’s proposed bids for 21st Century Fox.
With the AT&T-Time Warner deal approved, the next fight will be over 21st Century Fox. Comcast may try to outbid Disney as soon as Wednesday. https://t.co/Pa8rgOg24q
— The New York Times (@nytimes) June 13, 2018
