US Court Approves $85Bln AT&T Merger With CNN Owner Time Warner

The Comcast NBC logo is shown on a building in Los Angeles California

The Comcast NBC logo is shown on a building in Los Angeles California

Makan Delrahim, assistant attorney general for antitrust, recently signalled that regulators were open to the combination. AT&T asked the court to focus on the former. "Opposition to the Time Warner acquisition marked an aggressive turn by the Justice Department, but one that could be short-lived if Leon rules against the government".

The DOJ also faced harsher questioning from the judge, who came off exasperated at times during the government's arguments. Now that the merger has been approved look for the service to roll out this year. With no phones or computers allowed into the courtroom, and attendees required to stay until after the judge had left the courtroom, the public was left in the dark for almost 40 minutes Tuesday afternoon as they awaited the decision.

Comcast's offer is months in the making, as the company made an all-stock proposal for Fox in November that was actually more generous than Disney's.

On Tuesday, Wall Street considered Leon's decision a "canary in the coal mine" - or an indicator for whether Comcast could go ahead with an all-cash hostile bid for parts of 21st Century Fox.

Of course, it's not all about the X-Men or the Fantastic Four, but about Fox's cast array of intellectual properties that includes the Avatar, Alien, The Simpsons, and many more. Google owns the Android wireless phone-operating system and dominates online advertising.

AT&T has said it needs to buy Time Warner to compete with the likes of Amazon, Netflix and Google in the shape-shifting streaming-TV environment.

Americans for Limited Government President Rick Manning said the decision was regrettable.

The Justice Department can appeal and could ask an appellate court to stay the ruling, though Leon said he hoped the government would have the "good judgment" not to do so.

For Comcast, this is Take 2 in approaching Fox.

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Leon said the government failed to prove that the merger would lead to higher prices and other ham to consumers.

To see how this could happen, consider that, after the merger, AT&T would have the rights to all of HBO's output, CNN, live National Basketball Association and NCAA broadcasts, and many more desirable Time Warner properties.

USA government regulators tried to block the US$85 billion (NZ$120bn) deal, arguing the merger would reduce competition in pay TV and lead to higher prices for consumers. It could also set in motion a series of mega deals across industries.

Comcast would also buy the 20th Century Fox studios, its regional sports networks, and the F/X and National Geographic cable-TV channels.

Comcast Corp (CMCSA.O) offered $65 billion on Wednesday to lure Twenty-First Century Fox Inc (FOXA.O) away from a merger with Walt Disney Co (DIS.N), setting up a bidding war between two of the largest USA media companies with its 20 percent higher offer. Specifically, on future deals of this type.

But a changing corporate landscape and the rise of digital technology may have made those distinctions partly obsolete.

The suit stunned investors and antitrust lawyers because it broke with years of past practice for reviewing such deals, known as vertical mergers.

The AT&T case has long had political overtones. AT&T and Time Warner say that by coming together they can create synergies of data and information that will help them make better content and sell more targeted ads, which they claim could ultimately help lower prices for consumers. "The fact is that they've gotten a little easier, and we'll see a big flurry of deals". "It puts too much power in too few hands".

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