In antitrust trial, DOJ claims memo shows AT&T-Time Warner are merging to protect pay TV business

As the antitrust battle between the Department of Justice and merger hopefuls AT&T and Time Warner moved through its third week in court, the government accused the companies of trying to shore up their lucrative pay TV business at the expense of rivals—and presented a memo as proof.  It was a draft document from April 2017 created by an AT&T executive touting the combination as a way to “ensure stability” of the pay TV business. The memo said the business was in a “slow, structural decline” but would be a “cash cow” for years to come, according to press reports. The DOJ had sued to block AT&T’s $85.4 billion acquisition of Time Warner for what it claimed was that very reason—that a merged company could raise prices for pay TV rivals and slow the development of online video. During opening arguments in the trial last month, the Justice Department’s lead attorney called pay TV the company’s “cash cow.”