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AT&T-Time Warner merger could change media landscape

The global media landscape may be in for a major shake-up in the wake of the approval of a mega-merger between telecoms giant AT&T and media firm Time Warner.


US government regulators tried to block the $85 billion deal, arguing the merger would reduce competition in pay TV and lead to higher prices for consumers.

However, the Federal Court rejected those arguments and approved the deal without conditions.

The deal is what is known as a vertically integrated merger: a joining of two companies that do not directly compete with each other.

It will bring together AT&T's significant wireless, satellite television and internet business with Time Warner's media properties, which include HBO and CNN.

The judge advised the US regulators that their arguments were so weak that they should not even bother to appeal, although several legal experts believe the ruling is so significant it will not go unchallenged.

The case comes as the growth of online firms like Amazon and Netflix have scrambled traditional lines of competition, spurring consolidation and prompting concerns about monopolies.

But regardless of that outcome the decision is being seen as a green light for other big deals, which have been sitting in the wings waiting for the ruling.

Mobile company Comcast is expected to be in quick with a bid for 21st Century Fox assets, including its stake in Britain's Sky, in a challenge to a deal announced between Fox and Disney last year.

The gates are expected to open, with US telecom companies such as Verizon, Sprint and T-Mobile looking to snaffle up media concerns such as Viacom, Discovery, and CBS.

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