U.S. District Judge Richard Leon ruled that the combined companies do not pose a danger to consumers, a decision that amounts to a resounding win for the two companies.
The judge, based in Washington, has spent the last few months listening to arguments for and against the deal. AT&T and Time Warner claimed the deal will be good for consumers and help them compete against tech companies such as Google and Facebook. The Department of Justice, with the support of President Donald Trump, opposed the merger, arguing that the combined companies would be too powerful and reduce competition.
Makan Delrahim, the antitrust chief of the DOJ, said in a statement that he and his staff are “disappointed” but will “closely review the Court’s opinion and consider next steps,” leaving the door open for an appeal of the ruling.
The acquisition will create one of the most powerful companies in global media, marrying AT&T’s widespread consumer distribution capabilities with the crown jewels of Time Warner, including HBO, Warner Bros. film and TV studios, and TV channels including CNN, TNT and TBS.
“We are grateful to the court for seeing it the way we did, for recognizing this case was meritless,” Ginsberg said. “It was political and should never have been brought in the first place.”
Ginsberg added that Time Warner CEO Jeff Bewkes is “happy and relieved.”
Approval of the deal is expected to trigger more deals that could redraw the media and marketing landscape. Comcast is now expected to make an aggressive bid for parts of 21st Century Fox, which already has a deal to sell some of its entertainment assets to Disney.
The judge’s decision could also give a green light to other mergers in the health care realm where CVS Health is set to combine with Aetna, and Cigna is merging with Express Scripts. T-Mobile also has a deal to buy Sprint.
“There is euphoria now, but in five years all these companies will be owned by Google, Alibaba, Facebook or Amazon,” Klein said. “All these media companies are fighting with each other, but they’ll all be subsidiaries of other companies.”
AT&T and Time Warner together are some of the largest buyers of advertising around the globe, spending billions of dollars to market their products. AT&T has said it expects to find $1 billion in synergies in the first three years of the deal.
This ruling is an assault on consumers, choice, and innovation,” Markey said in a statement. “The telecommunications market needs more competition, not more consolidation.”
AT&T has claimed its ownership of Time Warner will allow it to offer customers bundles of services and better mobile experiences, including offering people free access to its newly acquired cable channels — as long as those people are AT&T wireless customers