AT&T insists it's not sweating US govt block of Time-Warner gobble
'We don't care, in fact look at this letter about how little we care. Really. Please look at it'
AT&T says it is not worried about the possibility of a US government lawsuit derailing its attempts to acquire Time-Warner.
Shortly after news broke on Monday that Uncle Sam's Department of Justice was filing suit in Washington DC to block the proposed $85bn merger, the American telecoms giant issued a statement saying it would not be deterred by the prospect of a showdown with the government.
"Today’s DoJ lawsuit is a radical and inexplicable departure from decades of antitrust precedent," wrote AT&T general counsel David McAtee.
"Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market. We see no legitimate reason for our merger to be treated differently."
AT&T basically arguing: If DoJ is blocking us from buying Time Warner, then you need to break up companies like Facebook.— Dan Primack (@danprimack) November 20, 2017
The DoJ's complaint to the district court claimed that if AT&T were allowed to gobble Time-Warner – the broadcast company, not the Charter-owned cable provider – it would gain an unfair advantage in the market that would result in worse service for the pubic.
"AT&T/DirecTV would hinder its rivals by forcing them to pay hundreds of millions of dollars more per year for Time-Warner’s networks, and it would use its increased power to slow the industry’s transition to new and exciting video distribution models that provide greater choice for consumers," the DoJ said in its complaint.
"The proposed merger would result in fewer innovative offerings and higher bills for American families."
The suit doesn't exactly come out of nowhere. For weeks there has been speculation out of Washington DC that the Trump-led DoJ would seek to stop the deal, if for no other reason than President Snowflake's CNN-induced temper tantrums. Time-Warner happens to own CNN, Donald hates CNN, now the Time-Warner deal is in trouble. Imagine that.
AT&T, meanwhile, counters that not only is the claim that a combined AT&T/Time-Warner would ruin the TV market wrong, but the DoJ isn't going to be able to stop the merger from going forward even if it wanted to.
"Fortunately, the Department of Justice doesn’t have the final say in this matter. Rather, it bears the burden of proving to the US District Court that the transaction violates the law," McAtee wrote.
"We are confident that the court will reject the government’s claims and permit this merger under longstanding legal precedent." ®