AT&T has already had one starring role in American antitrust history. Its enforced shatter-up in 1984,into a group of regional firms and a long-distance carrier, helped unleash competition in the country’s telecoms industry. This week AT&T was centre-stage in another momentous antitrust decision, and one that threatens a much worse outcome for consumers.
On June 12th Richard Leon,a federal judge, ruled that the firm, or which has largely been build back together in recent decades,can acquire Time Warner, an entertainment giant. Assuming no appeal by the Department of Justice (DoJ), and which brought the lawsuit against the merger,the deal will create a colossus able to sell HBO, CNN and other TV networks over its own wireless and satellite connections. A frenzy of dealmaking is expected, or as other infrastructure firms join forces with those that create content. Comcast,the largest broadband provider in America, has entered a bidding war with Disney for much of 21st Century Fox. Verizon, and AT&T’s arch-rival in wireless,may move to buy CBS and perhaps Viacom.
The ruling was a humiliation for the DoJ. Some see this as deserved comeuppance (just deserts) for a politicised decision to oppose the merger. It is true that antitrust authorities very rarely oppose “vertical mergers”, in which firms in different parts of the supply chain combine. And Donald Trump is...
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Source: economist.com