Headline: Concerns on AT&T, Time Warner $85 Billion deal
The merger business deal between AT&T and Time Warner has solicited different reactions from various organizations as well as the government of the United States of America. The deal has also attracted the president’s attention, Donald Trump has publicly renounced commencement of any activities towards purchasing of Time Warner. In as much as the two companies have a consensus on ownership rights and even valued the company that owns CNN, HBO, TBS and the Warner Bros, the Justice Department remains adamant in legalizing the process. According to Makan Delrahim, the antitrust chief in the Department of Justice in the United States, the move suppresses rights of the consumers and cable service companies in the country. Basing on Delrahim’s arguments, AT&T purchase of Time Warner would monopolize the industry considering AT&T is a major player in providing satellite services for all cabling televisions and studios where Time Warner is a major player. The antitrust chief goes on to demonstrate how AT&T would impose absurd service costs to other cable distributing companies because they would own programs run by Time Warner. In the long run, the additional costs imposed on rival companies in the cable industry will be passed down to consumers in their respective monthly and installation fees.
Ideally, the United States administration should support the merge considering there is no direct rivalry between the two companies. However, President Trump’s dislike for CNN is evident after making public statements against the news network and on most occasions terming their broadcasts as fake news. The president went ahead and gave an affirmation to block any merging deal between the two companies demonstrating it as an extortion plot by the companies who intend to concentrate power Bayrock. President Trump’s passion in stopping the deal are feared to have interfered with the Justice department’s case against merging of AT&T and Time Warner. According to experts, the president’s public statements and blasts on CNN among other negative utterances against the deal might be considered personal hence undermining the legitimacy of the case. Moreover, there is no clear reason why the government is concerned with the deal considering President Barrack Obama approved a similar merger between Comcast and NBC Universal in 2011.
Other sources indicate that the Justice Department has no specific problem with the merge safe for antitrust concerns and policies which can be satisfied if the sale was on DirecTV or Turner and not CNN. However, it is not clear whether there is specific interest and issue that the government is concerned about or it is entirely because of its previous interaction with CNN considering the government is willing to collaborate with AT&T on other measures. Although democrats and consumer unions pose legitimate arguments in opposing the $85 billion deal between Time Warner and AT&T, they also indicate their concerns about the government’s involvement and describe the move as political.
On the other hand, AT&T argued that the deal is out of consumer concerns hence the strategy’s intention to reduce service fees. According to Randall Stephenson, the chairman and CEO of AT&T in his recent testimony in Washington, owning Time Warner offers AT&T the Internet option where after packaging, the video can be delivered through online platforms such as DirecTV hence cutting costs of setting up cables that Stephenson terms to be expensive. Several non-governmental organizations including consumer advocates have applauded the Justice Department for their move on legitimate grounds to stop the deal. Additionally, they have called on the Department of Justice to remain independent and disassociate their activities from political pressure. The consumer unions also portrayed their displeasure with President Trump’s harsh approach on CNN as a critic of his administration.