Senate panel sets hearing on AT&T-Time Warner merger

Jeff Bewkes, Time Warner’s CEO, said on Sunday that owning the local Atlanta station was “not really necessary”. With his surprise $85 billion takeover bid for Time Warner, Randall Stephenson, AT&T’s chief executive officer, is betting that the companies that will thrive in a world of streaming and smartphones must be both. Or, it thought it had. Pay-TV distributors have been merging to increase their negotiating leverage over the price increases media companies have been charging for their content.

So for a glimpse of what the future might hold for AT&T and Time Warner, a look back at the Comcast-NBC merger can be instructive. For instance, many areas of the country have only one or two choices when it comes to cable television, maybe one or two choices for satellite television, and maybe two internet offerings (this is about the amount of competition in my hometown).

The Justice Department’s antitrust division will analyze the deal in the months ahead.

At a press conference, Wheeler called questions about the deal hypothetical, since nothing has been filed.

AT&T and Time Warner would have to submit an application to the FCC if the merger involved a transfer of broadcast and/or wireless licenses. That led many on Wall Street and in Washington to speculate that an FCC review could be avoided if that particular license is sold.

“This is a structural advantage that AT&T would have over its rivals, and competition authorities should be concerned about the possible effects”, said John Bergmayer, senior counsel at advocacy group Public Knowledge. And while Trump is wrong about a media conspiracy trying to rig the election against him, he’s right to raise red flags about concentrating too much power in the hands of too few. The licenses themselves say they can not be transferred without permission of the FCC. Time Warner didn’t respond to a Bloomberg BNA request for comment.

The Republican and Democratic leaders of the panel announced Thursday that the December 7 hearing will focus on the planned merger’s impact on consumers. The deal doesn’t pose the kind of clear threat to consumers that’s seen when a company seeks to buy a direct competitor, as AT&T did with its ill-fated attempt to purchase T-Mobile.

AT&T recently offered up its own version of zero-rating (when users stream content without using up data allowances) by allowing its customers who are also DIRECTV subscribers to stream content without data usage.

Share and share alike: While the FCC is creating barriers to AT&T’s simply tapping into consumer data, other US media companies are gearing up to ask regulators to make AT&T and Time Warner share their data trove, according to Reuters. They can offer deals and services without having to ask for them. “We are interested in making sure that we have access to our customer data in the same way that Time Warner will have access to data”.

We’re rapidly shifting toward online video consumption in the detriment of cable and satellite television services and AT&T wants to bet big on the trend, but it’s entering a pretty crowded market.