October 2016

Sen Sander to Justice Department: Block AT&T purchase of Time Warner

Sen Bernie Sanders (I-VT) is demanding the Department of Justice block a deal for AT&T to purchase Time Warner, arguing acquisition would negatively affect Americans. The former Democratic presidential candidate sent a letter to Renata Hesse, the acting assistant attorney general of DOJ's antitrust division, warning that the proposed $85 billion sale of Time Warner to telecommunications behemoth AT&T would mean a "gross concentration of power."

“This merger represents a gross concentration of power that runs counter to the public good and should be blocked," Sen Sanders wrote. He said that he believes the sale, which must be approved by federal regulators, would lead to less diversity and news content, and could mean higher prices and fewer choices for consumers. "The media and telecommunications landscape is changing. It is important that public policy concerns guide these changes, so that we may preserve our democratic discourse and open competitive markets for speech and commerce,” Sen Sanders wrote. "That is the function of antitrust laws," he added. "I ask you to enforce them and block the merger."

AT&T/Time Warner seems headed for FCC review, whether AT&T likes it or not

Some news organizations have reported that Time Warner has only one Federal Communications Commission license, for a TV station in Atlanta, and that the AT&T/Time Warner merger wouldn't be reviewed by the FCC if Time Warner sells that TV station to a third party. That is not correct, however.

Time Warner programmers such as HBO, CNN, and Turner Broadcasting System also have dozens of FCC licenses that let them upload video to satellites used by pay-TV companies. These licenses are crucial for distributing video to cable TV providers. It isn't only satellite TV companies like Dish or the AT&T-owned DirecTV that use satellites to send programmers' video to consumers' homes—even cable companies like Comcast use what's called a "headend in the sky" to receive and distribute video. The FCC's list of active satellite Earth station licenses shows that CNN America has 36 such licenses covering operations at specific locations. HBO and HBO Latin America have a combined seven licenses, and Turner Broadcasting System has 14 licenses. That's 57 licenses that could trigger an FCC review. Licenses for some of the same locations were part of the FCC's review of Time Warner's merger with AOL in 2001. AT&T would love to avoid an FCC review, which in the past has killed deals such as AT&T/T-Mobile and Comcast/Time Warner Cable.

Consumer Federation of America: FCC Needs to Rein In Media Oligarchs

The Consumer Federation of America is strongly opposed to the AT&T-Time Warner merger, which is no surprise, but is using the presence of four already consolidated media companies, including AT&T, to push for a quartet of items currently before the Federal Communications Commission. CFA issued a new paper suggesting the media industry is a "tight oligopoly on steroids"—AT&T, Verizon, Comcast and Charter—that needs repairing through those industry actions. CFA said disallowing any further consolidation through an AT&T-Time Warner merger is a no brainer, but that trying to break up the others, though likely its preference, could take "decades of litigation" that might or might not bear fruit or in this case pare the trees.