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AT&T wins U.S. court approval to buy Time Warner for $85 billion

Discussion in 'The NF Café' started by mr_shadow, Jun 12, 2018.

  1. mr_shadow Minister of State Security Moderator

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    AT&T Inc won approval from a U.S. court on Tuesday to buy Time Warner Inc for $85 billion, without conditions, allowing AT&T to compete with internet companies that dominate digital advertising and providing new sources of revenue.

    The planned deal is seen as a turning point for a media industry that has been upended by companies like Netflix Inc and Google which produce content and sell it online directly to consumers, without requiring a pricey cable subscription. Distributors including cable, satellite and wireless carriers all see buying content companies as a way to add revenue.

    The ruling could also prompt a cascade of pay TV companies buying television and movie makers, with Comcast Corp’s bid for some Twenty-First Century Fox Inc assets potentially the first out of the gate.

    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. It would also be the 12th largest deal in any sector, the data showed.

    “I conclude that the government has failed to meet its burden of proof,” District Court Judge Richard Leon told the court. He called one of the government’s arguments against the deal “gossamer thin.”

    The judge in a scathing opinion urged the U.S. government not to seek a stay of his ruling, saying it would be “manifestly unjust” to do so and not likely to succeed.

    Shares of AT&T were about flat in after-hours trade following the decision, while Time Warner rose more than 5 percent.

    The Justice Department filed a lawsuit to stop the deal in November 2017, saying that AT&T’s ownership of both DirecTV and Time Warner would give AT&T unfair leverage against rival cable providers that relied on Time Warner’s content, such as CNN and HBO’s “Game of Thrones.”

    AT&T in a six-week trial argued that the purchase of Time Warner would allow it to gain information about viewers needed to target digital advertising, much like Facebook Inc and Alphabet Inc’s Google already do.

    AT&T and other wireless carriers need to find new sources of revenue as the mobile phone market stagnates and more customers abandon pricey cable and satellite packages for streaming services they can watch on their phones or televisions.

    The government estimated costs to industry rivals, such as Charter Communications Inc, would increase by $580 million a year if AT&T owned Time Warner.

    To assuage the Trump administration’s criticisms, AT&T offered to submit pricing disagreements with other pay TV companies over Turner’s channels to third-party arbitration. The companies further offered not to black out programing during arbitration for seven years.

    Announced in October 2016, the deal was quickly denounced by Donald Trump, who as a candidate and later as president has been critical of Time Warner’s CNN and its coverage.

    Before the trial started, AT&T lawyers said the Time Warner deal may have been singled out for government enforcement but Judge Leon of the U.S. District Court for the District of Columbia rejected their bid to force the disclosure of White House communications that might have shed light on the matter.

    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 ruling could also have implications for CBS Corp’s potential tie-up with Viacom Inc, which is already uncertain because of a lawsuit between CBS’s controlling shareholder, Shari Redstone, and its board.

     
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  2. Skaddix Well-Known Member

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    Who needs Anti Trust Protection anyway...Monopolies are fun.
     
  3. CrazyAries Truth Hurts

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    I just saw this story on another website. It looks like the government made a very bad case for opposing this deal, although I feel that this deal should have been rejected because of how large AT&T would become.

    The Justice Department argued that this deal would be unfair to AT&T's competitors, but it's main argument should have been about the effect it would have on consumers. Americans already deal with oligopolies and that lack of choice makes it easier for companies like AT&T to charge exorbitant prices and control the flow of information.

    Was this necessary?
     
  4. mr_shadow Minister of State Security Moderator

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    As someone living outside the U.S. and not directly affected by American telecom monopolies, my main concern is how this will affect DC Comics and their adaptations in other media. :maybe

    Would AT&T ownership lead to better DC movies?
     
  5. CrazyAries Truth Hurts

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    After reviewing an older article from NPR, it appears that the Justice Department did argue that the AT&T-Time Warner merger would be harmful to consumers.



    However, the government rarely wins "vertical merger" cases and its recent behavior regarding the FCC, Sinclair, and Disney undermined it's own case.



    It's hard for the government to say that a merger will harm consumers while at the same time empowering a corporatist like Ajit Pai to undermine consumers by getting rid of net neutrality and repealing rules that would have precluded the Sinclaire-Tribune merger from happening in the first place.
     
  6. Skaddix Well-Known Member

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    Who Knows...there is no way to tell but its hard for it being much worse? Granted AT&T is a cancer so yeah it can probably get much worse.
     
  7. Atlas .

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    :hestonpls
     
  8. zeroantizero Well-Known Member

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    Seven "baby Bells" were created when the Bell System was broken up in the 80s, along with the remnant "old" AT&T. "New" AT&T and Verizon, baby Bells before telecoms deregulation in the 90s, own five and two of those companies, respectively. Centurylink, which wasn't originally part of the Bell System, owns one.

    So, essentially, a monopoly has been replaced by a duopoly, but without the intense regulation under which the monopoly was managed.
     
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  9. Kroczilla Well-Known Member

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    sort of. this case has really hurt both companies since they never expected any opposition to the merger in the first place (vertical mergers are virtually immune to anti trust regulations).
    not to mention, the deadline for the merger is next week i.e. any further delays could see the entire deal fall apart.
     
  10. CrazyAries Truth Hurts

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    This deal needs to fall apart, though. Unfortunately, the government hurt its own case by not cracking down on some other deals and making mergers like the Sinclair-Tribune merge easier.
     
  11. Rukia I’m the fucking game!

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    Bullshit ruling.
     
  12. Khaleesi Moderator

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    With T-Mobile having bought Sprint lately along with this, the big 3 phone companies have become very powerful
     
  13. Eternal Dreamer The Bored Lolmaster

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    85 billion? Lots of money.

    Was thinking the same thing really lol
     
  14. zeroantizero Well-Known Member

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    Seriously, though. In the outside world, it's amazing to see how many people are cheering AT&T for getting one on Trump. Even the New York Times is in on it.
     
  15. CrazyAries Truth Hurts

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    That's backward. I might not like Trump or most of the people in his cabinet, but this ruling is bad for consumers. That should come first, but the mainstream press is part of the problem. While it marvels at billionaires and the size of corporations, it does little, if any, advocacy for everyday individuals.
     
  16. Mider T VM Rapist

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  17. Eros Love is Love

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    I think, more or less, this will allow AT&T to compete with Verizon. It's not truly a monopoly or an oligopoly. Now, if Google and Amazon announce a merger, that'd be taking it too far.

    Also, it is best to look at something like this on a case-by-case basis, rather than an "OMG, Republicans are exploiting consumers again!" fearmongering. It's not always correct to take a liberal point of view on every single issue.
     
    Last edited: Jun 16, 2018 at 9:06 PM
  18. Samus Aran Derp

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    Honestly Amazon is too big as is.
     
  19. Skaddix Well-Known Member

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    Oh no doubt they don't have any real competition...I mean sure you can get stuff shipped to you without Amazon but no one other site offers the options that Amazon does and that is not even counting Amazon trying to get into Entertainment.
     
  20. Eros Love is Love

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    Yes, and so are Microsoft, Google, Walmart, and Koch Industries.
     
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