The DoJ said the takeover threatened competition and could drive up prices for people. The opposing parties, AT&T, Time Warner and DirecTV disagreed, saying the market was in the middle of a revolution facilitated by high-speed internet, producing a “veritable explosion” of new, innovative video content and advertising offerings over the past five years. And now, traditional media organisation are faced with declining video subscriptions and TV ad revenues. The merger would be a way to catch up with the competition, though it would still be chasing “tail lights”: the crux of the matter for the judge was the statement by Time Warner that the combo of Facebook, Apple, Amazon, Netflix and Google (FAANG) are together worth USD 3 trillion. The merged company would by comparison only be worth USD 300 billion.
The judge said the government failed to show how the merger would “substantially lessen competition,” that AT&T will act to harm virtual MVPDS through its ownership of Time Warner content, that AT&T will restrict distributor use of HBO as a promotional tool.
The Communications Workers of America (CWA) congratulated AT&T for its court victory, saying it supports the job creation aspects of the merger. CWA also expects increased investment in its communities through improved services and benefits for consumers.
Consumer group Public Knowledge said the result was “disappointing” and that it expects the government to appeal.
