Judge rules AT&T can purchase Time Warner

Adjust Comment Print

Time Warner shares are up about 5% at $100.91.

U.S. district judge Richard Leon dismissed the antitrust case brought by the justice department last November, the culmination of a 20-month ordeal that has seen the deal attacked by Donald Trump, critics of media consolidation and consumer groups.

USA government regulators tried to block the US$85 billion (NZ$120bn) deal, arguing the merger would reduce competition in pay TV and lead to higher prices for consumers. For more, RT America's Manila Chan is joined by former Florida Democratic Party Chair Mitch Ceasar and GOP Strategist Ken Del Vecchio. The first example could come quickly when Comcast decides how much to bid for assets owned by 21st Century Fox, FOX 1.18% which has agreed to sell them to Walt Disney.

A high-stakes decision in a USA court Tuesday will be significant for the future of Big Media, Big Tech and big business in general.

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. However, now that the AT&T deal has been approved by a federal judge, there is precedent for such a deal and Comcast believes it won't be blocked. It proposed that either AT&T not get Turner in the deal or that it should divest itself of DirecTV prior to acquiring Time Warner.

The merger, if permitted by Judge Richard Leon, is widely considered to be a harbinger of future media mergers that could radically shift how Americans consume television and movies going forward.

AT&T has won a court ruling that will allow it to buy Time Warner Inc., Bloomberg and other media outlets reported today.

"We could see some pressure on spreads", Knutson said.

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.

Announced in October 2016, it was seized on by then presidential candidate Donald Trump as the sort pf deal his administration would block.

These firms have argued since announcing the deal in April that the only way they can build out the next generation of wireless networks, and keep the industry competitive, is if they combine forces.

The high court is expected to hand down a decision in that case on Thursday. Stephenson said Watch would only be possible if the merger went through. The Justice Department contended that the deal - which brings cable companies including CNN and HBO into AT&T's fold - would enable the telecom to harm competitors - including online distributors - by withholding (or demanding excessive fees) for popular channels. Therefore, AT&T would likely increase the rates that other content distributors must pay to air Time Warner content - forcing its rivals to either raise prices on their subscribers (which would inspire some consumers to switch to DirectTV), or else accept lower profit margins (which would impair their ability to compete with AT&T in the long term).