In a blow to the Justice Department, AT&T's planned acquisition of Time Warner Inc received a nod from a federal judge on Tuesday without any conditions, opening the door for companies such as Comcast Corp, and Verizon Communications Inc to pursue deals to buy creators of media content.
"This decision from Judge Leon will have broad ramifications for the tech, telecommunications and media sector for decades to come", said Daniel Ives, the chief strategy officer at GBH Insights.
Leon said the government failed to prove that the merger would lead to higher prices and other ham to consumers.
Leon said the government had "taken its best shot" to oppose the merger.
We're still waiting to get a copy of the full ruling, but Bloomberg TV reported that US District Judge Richard Leon ruled entirely in AT&T's favor.
The lawyer added that the merger would be completed no later than June 20 of this year.
BREAKING: AT&T, Time Warner Merger Cleared
The Justice Department had repeatedly suggested the judge consider forcing AT&T to divest some of Time Warner's cable channels. It is, he said then, "a deal we will not approve in my administration because it's too much concentration of power in hands of too few".
Dallas-based AT&T is a wireless, broadband and satellite behemoth that also became the country's biggest pay-TV provider with its purchase of DirecTV. It claims about 25 million of the 90 million or so US households that are pay-TV customers. The company could offer to sell off assets that the government says could contribute to anti-competitive practices. It is expected to appeal and ask for a stay - a delay that could stop the deal from closing for four to six months while an appellate court ponders a decision, legal experts said. A clear win for AT&T will embolden Comcast, the US's largest cable company, to top Walt Disney's $52bn bid for 21st Century Fox, the media empire controlled by Rupert Murdoch and his family.
Some thought Trump had pressed for the lawsuit because of his animus toward Time Warner's CNN.
Bloomberg via Getty Images AT&T CEO and Chairman Randall Stephenson exits federal court in April. It could tie products together, offering AT&T phone customers free access to Time Warner offerings, squeezing out competitors that do not own media companies.
The companies' main economist, Dennis Carlton from the University of Chicago, refuted Shapiro's model as overly complicated and rejected his conclusions.
"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 fact, he suggested, consumers could end up paying less after a merger - maybe even $500 million less annually.