If AT&T buys Time Warner and eventually centralizes telecom markets, it wouldn't be the first time the telecom industry was monpolized under something resembling a state sanctioned monopoly.
Up until the 1980s, american consumers were not able to legally own telephones. They had to rent phones from the bell monopoly system. Long distance prices were very high. There was no industry innovation or advancement. After the bell monopoly was broken up under anti trust laws under (I think) Reagan's administration, that was when the telecom industry began to see rapid advancement. Cheaper long distance calls, cell phones, a transition from rotary style phones to digital phones and later mobile phones. That came about from greater market competition created by breaking up the bell monopoly.
Some of this is recorded, here:
https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System
The rest can probably be found via search engine.
For a judge to say there's no precedent for AT&T buying Time Warner having negative effects. There could be a substantial amount of american history which contradicts that.
Topic: AT&T Cleared to Buy Time Warner (Read 200 times)
It seems like they are just wanting to postpone the unavoidable thing, but to be honest if you are having something that you cannot avoid it is very stupid to postpone the decision, which would anyway catch you.
This is not an "unavoidable thing".The US authorities can cancel the deal,if it's against the US anti-monopoly laws.The US telecom industry can't be dominated by one or two companies.This is bad for the customers and bad the US government.I don't think that the lack of net neutrality would hit the crypto world.Maybe some internet service providers will be crypto-friendly.
It seems like they are just wanting to postpone the unavoidable thing, but to be honest if you are having something that you cannot avoid it is very stupid to postpone the decision, which would anyway catch you.
There has been strong cooperation here in the telecommunications industry. This is considered a lever that will allow AT & T to raise prices for Time Warner content, with those costs passed on to consumers. It may also be seen as a challenge to face the market, hoping to revisit it. Hope the good will come to us.
I don't see this decision being revoked by any judge, there's little point in trying to delay the inevitable. It's really plain to see from the outside looking in that there is little in the way of controls to stop high level price collusion in the US and to promote competition. Mobile phone providers are a clear example of this, the US is meant to be at the forefront of competition and business yet has some of the most expensive mobile phone network costs in the world. While there are some legitimate reasons for this the biggest contributor is that the companies act as an oligopoly in which it is more profitable for them not to compete on price. The same thing happens across a large majority of industries and it won't be any different when this deal is struck and they're competing with Netflix and Amazon.
Quote
AT&T Inc. was cleared by a judge to take over Time Warner Inc. in an $85 billion deal that will fuel the mobile-phone giant’s evolution into a media powerhouse and could spark a wave of new mergers.
U.S. District Judge Richard Leon on Tuesday rejected the Justice Department’s request for an order blocking the Time Warner acquisition, saying the government failed to make its case that the combination would lead to higher prices for pay-TV subscribers. The judge put no conditions on the deal.
Time Warner gained as much as 5.8 percent in after-hours trading, while AT&T fell as much as 3.9 percent.
After nearly two years, AT&T is on the cusp of completing its acquisition of Time Warner, a deal it struck in a bid to become an entertainment giant that can feed Time Warner programming like HBO and CNN to its 119 million mobile, internet and video customers, and go head-to-head with Netflix Inc. and Amazon.com Inc.
"We think the evidence throughout the trial was quite clear and we’re very pleased that the court saw it the same way," said Daniel Petrocelli, AT&T’s lawyer. The company said in a statement that it plans to complete the takeover on or before June 20.
The Justice Department can appeal and could ask an appellate court stay the ruling, though Leon said he hoped the government would have the "good judgment" not to do so. The Justice Department’s antitrust chief, Makan Delrahim, said he was disappointed and will consider his next steps.
The judge’s decision could open the door to other mergers, including Comcast Corp. making a formal bid for the 21st Century Fox, which gained as much as 7.3 percent after the ruling and is also the target of competing interest from Walt Disney Co. The decision also may make it easier for Verizon Communications Inc. to buy a content company and clear the regulatory path for deals Cigna Corp. and CVS Health Corp. have already announced.
All of those deals would unite companies in different parts of an industry’s supply chain. For years, these so-called vertical deals have typically received light treatment from antitrust enforcers, unlike the horizontal mergers that bring together direct competitors. Opposition to the Time Warner acquisition marked an aggressive turn by the Justice Department.
Leon described part of the government’s case as "gossamer thin," saying that during the trial the Justice Department’s expert witness declined to back some of the government’s own theories.
"I conclude the government has failed to meet its burden to establish that the proposed transaction is likely to lessen competition substantially," the judge wrote in his opinion.
Leon said the government fell "far short" of showing that AT&T’s new Turner Broadcasting unit would have increased leverage in negotiations with distributors. He rejected testimony by distributors who said they were worried Turner would be able to raise prices.
"The bulk of the third-party competitor testimony proffered by the government was speculative, based on unproven assumptions, or unsupported -- or even contradicted -- by the government’s own evidence," Leon wrote.
The judge found similar deficiencies in the government’s other theory of harm to customers: that the deal would stunt development of streaming services.
Leon’s decision is a blow to Delrahim, who brought in a new enforcement approach with the case. The government’s November lawsuit was also the first major merger challenge under President Donald Trump, who railed against the tie-up when it was announced during the 2016 campaign. He vowed that his administration would oppose it, and as president, he has relentlessly attacked CNN for its news coverage.
Antitrust Theory
Trump’s criticism prompted speculation that the lawsuit was politically motivated. Still, the Justice Department’s case laid out a traditional antitrust theory: that combining two companies in different parts of a supply chain can give the merged company the ability to harm rivals.
The suit stunned investors and antitrust lawyers because it broke with years of past practice for reviewing such deals, known as vertical mergers. Rather than negotiating an agreement that imposes conditions on how AT&T can conduct business, Delrahim demanded AT&T sell businesses to address threats to competition, which the company refused to do.
"This is extremely bad for DOJ," said Chris Sagers, an antitrust law professor at Cleveland-Marshall College of Law. "This is probably the end of meaningful vertical enforcement for a good long time."
After Delrahim took over the division, he announced that the department would require asset sales to remedy harm to competition from vertical deals. Leon’s ruling raises the question of whether Delrahim can successfully maintain that stance.
The Justice Department claimed that AT&T’s acquisition of Time Warner would give the No. 1 pay-TV provider increased bargaining leverage over rivals like Dish Network Corp. that pay for Time Warner programming.
Harder Bargain
Because of AT&T’s ownership of DirecTV, it can drive a harder bargain with other distributors that want Time Warner content, the government’s lawyers argued during the trial. If negotiations break down and rivals can’t secure that programming, their customers could switch to DirecTV, the lawyers said. That leverage would allow AT&T to raise prices for Time Warner content, with those costs being passed on to consumers, according to the Justice Department.
The government’s case hinged on an economic model produced by Carl Shapiro, an economist at the University of California at Berkeley, who predicted an annual price increase to consumers of at least $285 million. AT&T attacked that projection as baseless, repeatedly poking holes in the various inputs Shapiro used to calculate the estimate.
In his opinion, Leon said Shapiro’s analysis had so many problems the government started backing away from it.
"I couldn’t help but notice that the more and more questions were raised during trial about the reliability of Professor Shapiro’s theory and model, the more the government appeared to be minimizing the importance of his analysis," the judge wrote.
https://www.bloomberg.com/news/articles/2018-06-12/at-t-cleared-by-judge-to-buy-time-warner-create-media-giant
U.S. District Judge Richard Leon on Tuesday rejected the Justice Department’s request for an order blocking the Time Warner acquisition, saying the government failed to make its case that the combination would lead to higher prices for pay-TV subscribers. The judge put no conditions on the deal.
Time Warner gained as much as 5.8 percent in after-hours trading, while AT&T fell as much as 3.9 percent.
After nearly two years, AT&T is on the cusp of completing its acquisition of Time Warner, a deal it struck in a bid to become an entertainment giant that can feed Time Warner programming like HBO and CNN to its 119 million mobile, internet and video customers, and go head-to-head with Netflix Inc. and Amazon.com Inc.
"We think the evidence throughout the trial was quite clear and we’re very pleased that the court saw it the same way," said Daniel Petrocelli, AT&T’s lawyer. The company said in a statement that it plans to complete the takeover on or before June 20.
The Justice Department can appeal and could ask an appellate court stay the ruling, though Leon said he hoped the government would have the "good judgment" not to do so. The Justice Department’s antitrust chief, Makan Delrahim, said he was disappointed and will consider his next steps.
The judge’s decision could open the door to other mergers, including Comcast Corp. making a formal bid for the 21st Century Fox, which gained as much as 7.3 percent after the ruling and is also the target of competing interest from Walt Disney Co. The decision also may make it easier for Verizon Communications Inc. to buy a content company and clear the regulatory path for deals Cigna Corp. and CVS Health Corp. have already announced.
All of those deals would unite companies in different parts of an industry’s supply chain. For years, these so-called vertical deals have typically received light treatment from antitrust enforcers, unlike the horizontal mergers that bring together direct competitors. Opposition to the Time Warner acquisition marked an aggressive turn by the Justice Department.
Leon described part of the government’s case as "gossamer thin," saying that during the trial the Justice Department’s expert witness declined to back some of the government’s own theories.
"I conclude the government has failed to meet its burden to establish that the proposed transaction is likely to lessen competition substantially," the judge wrote in his opinion.
Leon said the government fell "far short" of showing that AT&T’s new Turner Broadcasting unit would have increased leverage in negotiations with distributors. He rejected testimony by distributors who said they were worried Turner would be able to raise prices.
"The bulk of the third-party competitor testimony proffered by the government was speculative, based on unproven assumptions, or unsupported -- or even contradicted -- by the government’s own evidence," Leon wrote.
The judge found similar deficiencies in the government’s other theory of harm to customers: that the deal would stunt development of streaming services.
Leon’s decision is a blow to Delrahim, who brought in a new enforcement approach with the case. The government’s November lawsuit was also the first major merger challenge under President Donald Trump, who railed against the tie-up when it was announced during the 2016 campaign. He vowed that his administration would oppose it, and as president, he has relentlessly attacked CNN for its news coverage.
Antitrust Theory
Trump’s criticism prompted speculation that the lawsuit was politically motivated. Still, the Justice Department’s case laid out a traditional antitrust theory: that combining two companies in different parts of a supply chain can give the merged company the ability to harm rivals.
The suit stunned investors and antitrust lawyers because it broke with years of past practice for reviewing such deals, known as vertical mergers. Rather than negotiating an agreement that imposes conditions on how AT&T can conduct business, Delrahim demanded AT&T sell businesses to address threats to competition, which the company refused to do.
"This is extremely bad for DOJ," said Chris Sagers, an antitrust law professor at Cleveland-Marshall College of Law. "This is probably the end of meaningful vertical enforcement for a good long time."
After Delrahim took over the division, he announced that the department would require asset sales to remedy harm to competition from vertical deals. Leon’s ruling raises the question of whether Delrahim can successfully maintain that stance.
The Justice Department claimed that AT&T’s acquisition of Time Warner would give the No. 1 pay-TV provider increased bargaining leverage over rivals like Dish Network Corp. that pay for Time Warner programming.
Harder Bargain
Because of AT&T’s ownership of DirecTV, it can drive a harder bargain with other distributors that want Time Warner content, the government’s lawyers argued during the trial. If negotiations break down and rivals can’t secure that programming, their customers could switch to DirecTV, the lawyers said. That leverage would allow AT&T to raise prices for Time Warner content, with those costs being passed on to consumers, according to the Justice Department.
The government’s case hinged on an economic model produced by Carl Shapiro, an economist at the University of California at Berkeley, who predicted an annual price increase to consumers of at least $285 million. AT&T attacked that projection as baseless, repeatedly poking holes in the various inputs Shapiro used to calculate the estimate.
In his opinion, Leon said Shapiro’s analysis had so many problems the government started backing away from it.
"I couldn’t help but notice that the more and more questions were raised during trial about the reliability of Professor Shapiro’s theory and model, the more the government appeared to be minimizing the importance of his analysis," the judge wrote.
https://www.bloomberg.com/news/articles/2018-06-12/at-t-cleared-by-judge-to-buy-time-warner-create-media-giant
If AT&T buys Time Warner, it will undoubtedly centralize the telecom industry. It will become more like healthcare which is unaffordable and expensive due to industry wide centralization riddled with agreements which lean towards price fixing and other predatory business practices which could be said to treat consumers unfairly and exploit them.
Hopefully, we'll see this case brought before another judge who might be willing to look at the evidence a little more objectively. With net neutrality recently being repealed, stacking more telecom centralization on top of that negative precedent undoubtedly would not be a good thing. It can impossible to get these points across due to educational neglect on these types of issues.
Greater telecom centralization and a repeal of net neutrality also could have negative precedents for crypto currencies although it is possible the impact will not be significant due to bitcoin and crypto not utilizing a substantial network load or presence. We'll have to wait and see what developments and repurcussions this may have within the cryptoverse.
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