The proposed $85 billion merger of AT&T and Time Warner has reportedly entered the conditions phase of its regulatory review and the Justice Department is looking to curtail the combined company’s power.
According to Bloomberg, before the deal is given the U.S. government’s go-ahead, AT&T is being asked to make vows of good behavior, including not granting unfair preference for its own programming. If the deal is approved, AT&T will own Warner Bros. Pictures, HBO and Turner networks including CNN, TBS and TNT.
As the report points out, the Justice Department’s review has been happening without the help of Makan Delrahim, President Trump’s pick to head the department, who is still awaiting congressional confirmation.
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While Delrahim doesn’t appear to have any major hangups regarding the deal, AT&T and Time Warner have faced scrutiny from a number of other interested parties.
Trump could use that as leverage in his war against CNN, according to The New York Times, and could possibly insist on CNN boss Jeff Zucker being fired before final regulatory approval is granted. Zucker, who was chief executive at NBCUniversal before taking over at CNN, a key piece of Time Warner’s media empire, has history with Trump. According to the Times report, Zucker hired Trump to host “The Apprentice” and after Zucker lost his job following NBCU’s acquisition by Comcast, Trump claimed he got Zucker his position with CNN.
AT&T and Time Warner have faced questions from lawmakers on both sides of the aisle about the perceived benefits of the merger.
AT&T CEO Randall Stephenson and Time Warner CEO Jeff Bewkes sent a letter to a group of lawmakers in order to ease some of the concerns about the size and scope of the combined company.
“AT&T and Time Warner have both encountered such friction as they have sought to bring innovations to market. That friction has kept consumers from getting the full suite of innovative features that they want,” the companies wrote.
Specific video-related innovations that AT&T and Time Warner see possible post-merger include:
- Short-form programming optimized for presentation on mobile devices
- Interactive and personalized methods of viewing sports and other live events
- More relevant advertising in ad-supported video services
- Integrations of professionally produced content with virtual reality or augmented reality services
- Services that encourage consumers to combine professionally produced content with their own creative content and share the results on social media
- Greater choice, convenience, and value in programming bundles