Senators probe AT&T-Time Warner deal

CEOs at AT&T and Time Warner, along with expert witnesses, answered senators’ questions about AT&T’s proposed purchase of Time Warner entertainment company for $108 billion. The deal combines the nation’s largest pay-TV provider and second largest wireless carrier with the third largest entertainment company.

Senators Klobuchar (D-MN), Blumenthal (D-CT), and Franken (D-MN), among others, raised concerns about the the anti-competitive impact of the transaction. AT&T’s Randall Stephenson made a commitment that the new company wouldn’t block or overcharge companies whose content competes with Time Warner’s. Time Warner’s CEO Jeff Bewkes said that his company would not overcharge AT&T’s competitors for its content.

“The reason we have these hearings is to get stuff on the record, right?” said Sen. Klobuchar, the subcommittee’s ranking member. “So they said on the record they wouldn’t discriminate. They said on the record that Time Warner wouldn’t discriminate, either, where the content went. So if that proves to be false, then you have it under oath that they said this, and then you can use that for further action.”

AT&T and Time Warner executives promised lower prices and more wireless infrastructure, if the deal clears the Dept. of Justice.

The two large companies claimed that their combination would challenge the cable industry and Silicon Valley tech companies. Mark Cuban, an Internet entrepreneur and reality-TV star, argued that the deal will increase competition in a market where Facebook, Google, Apple, and Amazon dominate. In a world where tech companies increasingly rely on algorithms to prompt content decisions, the AT&T-Time Warner deal would let viewers retain consumer choice.

“As a Facebook user I don’t get to pick what content I get to see in my newsfeed. I can try to influence it, but Facebook algorithms control what I see,” Cuban said. “As much of a geek as I am, I like having the choice of searching through a programming guide to see what’s on rather than an algorithm telling me what I should watch. I think a lot of consumers would like to see that choice continue as well.”

Watch the hearing and read the testimonies here.

Links:

AT&T to buy Time Warner for $85 billion (Speed Matters, Oct. 24, 2016)

Examining the Competitive Impact of the AT&T-Time Warner Transaction (US Senate, Dec. 7, 2016)

Lawmakers Change Their Tone on AT&T and Time Warner Deal (New York Times, Dec. 7, 2016)