On Monday, the U.S. Department of Justice sued to block AT&T’s $84.5 billion takeover of Time Warner. “This merger would greatly harm American consumers. It would mean higher monthly television bills and fewer of the new, emerging innovative options that consumers are beginning to enjoy,” said head of the Justice Department’s antitrust division, Makan Delrahim when he announced the suit.
AT&T is the largest provider of subscription TV in the US, and the DOJ is concerned that AT&T would use Time Warner’s massive library of programming to manipulate its rivals into paying millions more for Time Warner’s content, and effectively stifle competition. As we can see in this chart from Statista, many of the nation’s most popular networks lie within Time Warner’s control, and AT&T in turn has massive numbers of subscribers under its wing.
AT&T for its part, is confident the challenge to the deal will not hold up in court. In a response posted on its website, AT&T wrote that the DOJ “bears the burden of proving to the U.S. District Court that the transaction violates the law.”
- Mike Nudelman/Business Insider