Published: Wed, June 13, 2018

AT&T-Time Warner Ruling Reactions: Hollywood Scribes, Senator Among Critical Voices

AT&T-Time Warner Ruling Reactions: Hollywood Scribes, Senator Among Critical Voices

The tie-up would Wednesday largest United States pay-TV operator and the second-largest wireless phone carrier with Time Warner, owner of premium channel HBO, the Warner Bros studios, Cartoon Network and CNN.

AT&T in turn called the government's arguments "absurd" and has argued the deal is necessary for it to compete with tech companies like Netflix, Apple and Amazon as they spend billions to bolster their positions in media.

The Justice Department had argued that letting AT&T (a content distributor) combine with Time Warner (a content creator) would reduce competition between the mobile-phone giant and its rivals, and thus, hurt consumers.

AT&T's wooing of Time Warner has been politically complicated from the outset.

"Everyone's looking at here what happens in entertainment", said Gene Kimmelman, the president of Public Knowledge.

"The government's evidence is too thin a reed for this court to find that AT&T has, in that well worn turn of phrase, either the "incentive" or the "ability" to withhold HBO promotional rights in order to 'lessen competition substantially'".

Fox's stock jumped 7% in after-hours trading, and Disney's fell modestly amid predictions that Comcast, emboldened by the AT&T ruling, would make an aggressive bid for most of Fox's assets. According to investment banker Lloyd Grief, all hell is going to break loose now; he also went on to say, "Should be interesting, although I certainly wouldn't count Disney out". "Already, with their cable systems, they control what people see and hear".

On the campaign trail in October 2016, then-candidate Donald Trump spoke in Gettysburg, Pa.


Assistant Attorney General Makan Delrahim said the Justice Department was "disappointed" by the decision, but did not say if it planned to appeal.

The Justice Department charged that AT&T was buying Time Warner so the carrier could charge its competitors more to carry CNN, HBO and National Basketball Association games on TNT, or maybe even cut them off altogether to make its own distribution services more popular. Remember, Time Warner owns CNN, which is the object of some of Trump's most focused hatred. Delrahim maintained that he had not been instructed by the White House as to how to handle the transaction.

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

"The case stands as a testament to the wisdom of this combination of these two great companies will benefit consumers for generations to come", he told reporters following the decision.

"It was a case that should never have been brought", Petrocelli said. "The government could present no credible proof in defense of its theories".

AT&T can use the content from Time Warner to fill its streaming services DirecTV Now and soon-to-be-launched AT&T Watch, which are cheaper online video packages with fewer channels. Another federal antitrust agency steered clear of a formal probe of Amazon.com, for example, when the e-commerce giant sought to buy national grocery chain Whole Foods in 2017.

But Salil K. Mehra, a professor at Temple's Beasley School of Law and an expert on antitrust, said "this is a fearless new world in which leverage issues and the data collection on individuals make it harder to predict what will happen".

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