DOJ Loses Appeal Seeking to Block Telco Merger

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The US Department of Justice has lost its appeal to block the AT&T® and Time Warner® merger (again). A panel of three judges in the United States Court of Appeals rejected their claim to challenge the Telco merger, which, as per the DOJ, has started to “reshape” the media industry. The lawyers even tried to argue that the antitrust laws applied to allow the merger was incorrect and that the merger would negatively affect the competition in the telecommunications market and even hurt end users.

AT&T®, on the other hand, said that their acquisition of Time Warner® would not affect the competition, but instead bring more benefits for customers. They even said that the merger could lower customer bills as well, and offer more content to those who watch TV programming on mobile devices.

“The government’s objections that the District Court misunderstood and misapplied economic principles and clearly erred in rejecting the quantitative model are unpersuasive,” Judge Judith W. Rogers said. Consequently, the DOJ has lost for the second time now, and reports say that the Justice Department is not planning on another appeal.

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“The merger of these innovative companies has already yielded significant consumer benefits, and it will continue to do so for years to come,” AT&T’s general counsel, David McAtee, said. “While we respect the important role that the U.S. Department of Justice plays in the merger review process, we trust that today’s unanimous decision from the D.C. Circuit will end this litigation.”

This is a great news for AT&T®, who can now move ahead with their plans they have for WarnerMedia. Representatives from the company said that they would soon launch a few online products for their subscribers, with HBO® anchoring one of the services that would include movies and TV shows from Warner Bros. The Telco said that HBO® would still be an independent stand-alone service.

This is a good news for subscribers too, as the blockbuster hits like Wonder Woman and Harry Potter movies along with TV shows like Game of Thrones and Friends would now be accessible to them On Demand. Reports say that AT&T® is also planning to license some of the programming to other streaming services, which is a smart strategy to reach to more viewers. Yet at the same time, this strategy could backfire for their own streaming service, DIRECTV NOW®, because users would be able to access their content on other platforms.