Leslie Picker

After six months of pursuit, the Gannett Company said that it was withdrawing its offer to acquire the owner of The Los Angeles Times and The Chicago Tribune, a deal that would have extended Gannett’s national footprint and furthered consolidation in the newspaper industry.

Gannett, the publisher of USA Today, had made several efforts to acquire the former Tribune Publishing Company, now known as Tronc. The first two were rejected during the spring. Gannett said that the acquisition was an attractive opportunity but “in the end the terms were not acceptable.” Tronc shares plunged nearly 20 percent on the morning of Nov 1 on the news. Gannett shares were up 1.3 percent in early morning trading.

On Oct 24, AT&T’s chief executive, Randall L. Stephenson, and his Time Warner counterpart, Jeffrey L. Bewkes, sought to address some of their biggest criticisms:

The Strategic Rationale: During the hourlong call, a form of the word “innovate” was used 32 times. The two chief executives believe combining their companies will help them innovate around advertising, the shows and movies people watch and where they watch them (hint: on their cellphones).

Regulatory Risk: Over the weekend, politicians from across the political spectrum came out against the deal. Both Democrats and Republicans argued that too much consolidation between telecommunications and media could only be bad for consumers. Bewkes argued that consumers would not feel the effect of this transaction, that the cost would be “borne by advertisers and consumers get a break.”

Affordability: Vertical integration may help the two companies on the regulatory front, but it does not get them far from a cost-savings standpoint. The companies pegged so-called synergies at $1 billion in annual run rate, within three years of the deal closing.

A cable and internet provider decides to buy an entertainment conglomerate. The merger is met with skepticism by industry analysts and outrage by consumer groups, who complain that it would thwart competition, create unfair pricing and incite more media consolidation. That was 2009, when the cable giant Comcast announced it would acquire NBC Universal. When the next administration in Washington takes up the $85.4 billion deal between AT&T and Time Warner, the Comcast acquisition will be used as the lens to examine the changing media landscape.

In the end, the Justice Department and the Federal Communications Commission approved the acquisition of NBCUniversal, requiring some small management concessions but few divestitures. But AT&T and Time Warner will probably face a much sterner test. With a huge wireless business, too, the combination would be a new kind of media juggernaut. Donald Trump has already condemned the deal. Campaigning in Gettysburg, he Trump said he would block it if he were president, “because it’s too much concentration of power in the hands of too few.” Hillary Clinton, meanwhile, has promised to be tough on corporate megapowers and consolidation. Regardless of who wins next month, the AT&T acquisition of Time Warner will be among the biggest and most important regulatory cases to await the next administration. The merger would make AT&T unmatched in its size and reach to consumers through smartphones, home broadband, satellite television and a broad portfolio of cable channels and movies. For that reason, it may raise more cautionary flags than Comcast’s merger with NBCUniversal, which did not involve a wireless carrier.