Breaking Down The AT&T-Time Warner Decision

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Breaking Down The AT&T-Time Warner Decision

Peter Dinklage and Conleth Hill in a scene from Game of Thrones.

Judge Richard Leon rejected those arguments, approving the deal without conditions.

"AT&T/DirecTV would hinder its rivals by forcing them to pay hundreds of millions of dollars more per year for Time Warner's networks, and it would use its increased power to slow the industry's transition to new and exciting video distribution models that provide greater choice for consumers", the DOJ said in its complaint. In conclusion, he said, "the government has failed to meet its burden of proof".

The mega-merger is a high-stakes bet by AT&T Inc. on the synergy between companies that produce news and entertainment and those that funnel it to consumers. From Comcast's bid for 21st Century Fox to CVS's acquisition of Aetna, massive corporations increasingly have sought to expand their reach by buying up companies in different lines of business.

A merged AT&T-Time Warner could, in principle, refuse to supply content to some distributors in order to drive consumers to purchase its own access and content bundles, but it would not be in the merged company's financial interest to do so.

An array of public interest and labor groups - many of them far from supporters of Trump - nevertheless supported the Justice Department's attempt to block the deal. Cable, satellite and wireless carriers all see buying content companies as a way to add revenue. Between that now-pending battle and the approved merger of AT&T with Time Warner, the media landscape is undergoing a dramatic shift.

Trump, a frequent detractor of Time Warner's CNN and its coverage, denounced the deal when it was announced in October 2016.

In response to the ruling, US Assistant Attorney General Makan Delrahim said, "We are disappointed with the court's decision today".

The decision on a so-called "vertical integration" - between two companies who do not make competing products - could have a profound impact on future mergers.

A US court ruled that AT&T's deal for media giant Time Warner could go ahead over the objections of the US Department of Justice, which anxious that the combination would raise prices for consumers.

He took issue with the government's analysis that the merger would result in higher prices for consumers, telling a packed courtroom that the findings "rested on improper notions."‬ And Leon also warned the USA government against seeking a stay on the merger if it brings an appeal for the objective of trying to stymie the deal.

Originally it was said that AT&T had planned to launch AT&T Watch no matter what happens with the current Time Warner DOJ court case.

"We want people engaged with their mobile devices all day watching movies and video", Stephenson said in April during the trial.

The Justice Department had repeatedly suggested the judge consider forcing AT&T to divest some of Time Warner's cable channels.

Disney CEO Bob Iger has previously addressed the reports of Comcast's plans to out-bid Disney, stating he was "confident" in the latter's offer and the studio would remain optimistic about its ability to close a deal that shareholders were said to view favorably.

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