'Watershed moment': Judge gives go-ahead for AT&T-Time Warner deal
A federal judge said AT&T can go through with its $85bn purchase of Time Warner, owner of media properties including HBO, CNN, Cartoon Network and TBS.
AT&T initially announced its plans to acquire Time Warner in October of 2016, describing the move as the formation of a “new company with complementary strengths to lead the next wave of innovation in converging media and communications industry” at the time.
But the Justice Department sued to block the deal last year, setting the stage for an antitrust battle. The department sued over concerns that the merger could result in “higher prices and less innovation for millions of Americans.”
AT&T says the deal will help it better compete with the likes of Netflix and Amazon.
Gareth Davies, entrepreneur in residence at Digital Capital Advisors, said AT&T will now "will secure bragging rights for a wealth of content assets at a time where the internet giants, namely Apple, Amazon, Google/YouTube, Facebook and Netflix are aggressively investing in original content."
He also said this week's repeal of net neutrality means telecoms giants such as AT&T, "long considered dumb pipes," will now have carte blanche to control not just the pipes, but everything that flows through them.
"History will dictate how smart AT&T and their pipes really are. With this deal, don't count them out just yet," he said.
Lyle Schwartz, president of investment at GroupM North America, called the merger a "watershed moment" while speaking at the AUDIENCExSCIENCE conference on Tuesday.
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