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Get Ready for Cable Rate Increases! PDF Print E-mail
Wednesday, 13 June 2018 06:56

A federal judge gave the go-ahead Tuesday for AT&T to buy Time Warner for $85 billion, ruling against the Justice Department’s lawsuit to block the deal in November. You need look no further than the Charter and Time Warner Cable deal to see how service deteriorates and rates explode in these type deals.

The decision will make AT&T into a media jgiant. The company will not only own its telecom business and DirecTV, but also Time Warner’s massive television assets, including Turner Broadcasting and HBO. It could lead to more mergers and acquisitions between major companies, including proposed deals from Sprint and T-Mobile. And it ends a storyline that included President Donald Trump’s ongoing battle with CNN and hundreds of thousands of dollars paid by AT&T to Trump’s personal lawyer, Michael Cohen.

The decision from Judge Richard Leon, a George W. Bush appointee, comes after a six-week trial in US District Court in Washington, DC.

The Justice Department, which sued in November to block the deal, argued the merger would lessen competition and result in “higher prices and less innovation for millions of Americans.” The companies said the merger was necessary to compete in today’s media landscape and take on competitors such as Netflix and Amazon.

Time Warner and AT&T first proposed the merger in October 2016, ahead of the presidential election. At the time, then-candidate Trump vowed to block it.

“AT&T is buying Time Warner, and thus CNN, a deal we will not approve in my administration because it’s too much concentration of power in the hands of too few,” Trump said at a campaign rally in Gettysburg, Pennsylvania, citing it as “an example of the power structure I am fighting.”

The Department of Justice could appeal Leon’s decision, but they’ll have to do so on a tight timeline — the deadline to close the deal is June 21. Assistant Attorney General Makan Delrahim, who heads the department’s antitrust division, said he was “disappointed” by the decision in a statement on Tuesday.

“We continue to believe that the pay-tv market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner,” he said. “We will closely review the court’s opinion and consider next steps in light of our commitment to preserving competition for the benefit of American consumers.”