AT&T CEO Expects $85B Time Warner Deal To Skip FCC Review And Close By Year-End


AT&T's Chairman and CEO, Randall Stephenson, expects the huge $85 billion deal with Time Warner to close by the end of this year, skipping the Federal Communications Commission review.

The massive AT&T - Time Warner merger has been in the works for a while now and it's still pending approval, but Stephenson is confident that it will go through this year.

AT&T - Time Warner Merger On Track To Close This Year

Speaking with CNBC on Friday, Feb. 10, Stephenson said that the Justice Department's "one-track review" is going as scheduled and the deal is on track for a 2017 finalization.

Stephenson also said that he met with President Donald Trump and his administration on two occasions, but they did not discuss the deal in either conversation.

As a reminder, when he was still running for president, Trump vowed that if he got elected he would block the AT&T-Time Warner merger because it would give AT&T too much power. Trump said at the time that such a deal was exactly the kind of power structure he was fighting.

It remains to be seen whether Trump has changed his mind in the meantime or he still plans to oppose the merger.

AT&T-Time Warner Deal To Skip FCC Review

Stephenson further noted that under this deal, AT&T would not assume Time Warner's licenses. As such, the merger would no longer have to undergo an FCC review.

Trump recently appointed Ajit Pai as the FCC chairman and many believe net neutrality is in danger under the Trump administration. The FCC also announced recently that it would not be continuing the zero-rating investigations opened under former chairman Tom Wheeler. Should a deal of the magnitude of the AT&T-Time Warner merger indeed skip FCC review, it will likely raise even more net neutrality concerns.

AT&T, Time Warner, And Net Neutrality

If the deal goes through, AT&T will gain access to properties pertaining to Time Warner, including HBO, CNN and Warner Bros. Customers could get more attractive bundles for accessing premium content from AT&T at a lower price, but that could create an unfair advantage.

AT&T has already been criticized for favoring its own companies. For instance, AT&T's zero-rating went under FCC scrutiny because it included DirecTV, which AT&T owns. The FCC warned that this practice could violate net neutrality, but it may no longer have the same position with Pai now at the helm.

Nevertheless, if such deals are approved and telecom providers can keep swallowing media content companies, it may become challenging for consumers to access the same content from rival networks.

However, even if Stephenson is confident the deal will go through this year, there's no guarantee at this point. The Department of Justice could decide to block the deal should it be pressured to do so, at least if Trump remains firm on his position to oppose the merger.

Stephenson, meanwhile, reiterated to CNBC that its merger with Time Warner will not affect its offers for consumers. The AT&T CEO said it's a "clean transaction" and the entertainment and media industry would be unchanged.

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