Innovation or a monopoly? AT&T, Time Warner … 8:58 am Wed

A lot is at stake Wednesday as AT&T executives go before the Senate Judiciary Committee to answer questions about the company’s proposed acquisition of content provider Time Warner.

In his opening remarks, Stephenson touted the benefits of the deal and pointed attention to the company’s recent introduction of DirecTV Now.

Stephenson added there is no “reason to believe we could use Time Warner programming or AT&T networks to hurt related markets”.

At the hearing before a Senate antitrust subcommittee, Stephenson and Bewkes contended that the exchange would upset the commercial center in a way that will profit customers. “However critics argue that zero-rating transforms internet service providers or wireless carriers from ‘relatively neutral conduits into gatekeepers'”. Adding in Time Warner would just make the service even stronger. She also said AT&T could favor its own shows over independent content.

Mr. Stephenson and Time Warner CEO Jeff Bewkes positioned the deal as a way to increase competition with entrenched cable-distribution companies, as well as the power of internet giants like Alphabet Inc.’s Google and Facebook Inc., which dominate the online advertising space and are pushing into video services.

Not ensuring consumer benefits “sends a bad message to Americans”, Franken said. It already owns satellite TV company DirecTV.

In the future, it won’t be algorithms that choose what we see, our choices will be driven by some form of Artificial Intelligence learning from trillions of disparate inputs.

Gene Kimmelman, CEO of the advocacy group Public Knowledge, said in his prepared statement that the merger would enable AT&T to restrict competitors’ access to Time Warner programs.

The senators asked some tough questions and discussed the issues surrounding such a mega-merger.

Stephenson dismissed the concern, saying, regardless, the company will still be regulated by the FCC.

“To threaten more vigorous or adverse enforcement against a particular company because he doesn’t like the news coverage is a threat to the First Amendment”, Blumenthal said, adding that he likes that Trump is interested in anti-trust issues but is anxious that his interest exclusively comes from wanting to control media coverage. “I take him at his word”, Sen.

“Why?” Franken cracked in response.

Several GOP and Democratic lawmakers have voiced antitrust concerns surrounding the proposed merger, as did candidate Donald Trump, who said the blockbuster deal would concentrate too much power in the hands of too few. “What troubles me is that his Justice Department would enforce a different standard depending on what coverage he receives”. Stephenson said that he had not conversed with Trump’s move group.

On Tuesday, Stephenson suggested Trump may have expressed opposition to the deal because of his frustrations with CNN, which is part of Time Warner.

“That independence is what makes CNN so popular and valuable, and we will not do anything to change that”, he said.

It’s unclear if the deal will face FCC scrutiny. Time Warner owns CNN, HBO, Warner films and Turner Broadcasting.

He was hopeful about achieving “meaningful corporate tax reform” with Trump as president, noting that for the first time in many years, the company’s 2017 scenario includes better than expected economic growth.

When the proposed merger was announced in October, it set off alarms across the political spectrum about the impact of massive consolidation in the entertainment and media industry.

Speaking at a conference in NY on Tuesday, Stephenson said he’s “hopeful that perhaps a more moderate approach to some of these regulations is in the making under a Trump administration”.