Lawmakers Doubtful On AT&T & Time Warner Merger, Express Concerns But No Opposition During Senate Hearing

A senate hearing was held on Wednesday on the issue of AT&Ts proposed $ 85.4 billion acquisition of Time Warner Inc.  No lawmaker criticized it as anti-competitive, however, most are doubtful and expressed caution of the deal. The official sentiment was noticeably changing  considering said issue received various concerns among Democrats and Republicans alike in October when the deal was first announced.   

Then-presidential candidate Donald Trump  expressed  opposition in public and  that he will do everything to block it. He said that it will give too much media power in one company. 

This proposed deal would be a merger of AT&Ts pay-TV subscribers and wireless customers with the one of the country's high-quality media content company. Time Warner  owns HBO, Cinemax, CNN, Cartoon Network and the Warner Bros film studio, among others. 

Randall Stephenson, Chief Executive Officer of AT&T  cites significant reasons why a merger with Time Warner Inc  is pro-competitive. He said that many consumers are upset with high cable bills and that the merger would bring "better-priced options" to consumers. "We want consumers to pay for their content once and watch it anywhere anytime," he said further during the hearing. 

Lawmakers have different views about the agreement. Senator Amy Jean Klobuchar (Democrat-Minnesota), voiced concern that   competitors might be denied a license to air  Time Warner's movies and television shows.    

The same concern was raised by a fellow Democrat Senator Al Franken. Senator Franken  asked Jeffrey Bewkes, Time Warner CEO if the merged companies would increase rates to competitors who would broadcast its content. "It would not have the incentive nor would it have the ability," Bewkes answered. 

Republican Senator Michael S. Lee, Chairman of the Antitrust panel, said that  the review by the U.S. Justice Department would be "very fact-intensive."  "Consumer welfare is maximized by protecting competition, not necessarily by protecting competitors," Lee added.  It would be determined by the Justice Department whether the deal is legal under the antitrust law. 

Republican Sen. Chuck Grassley (Iowa) and Chairman of the Judiciary Committee said, "No doubt, this industry is going through a transformative and disruptive time, and consumers are enjoying the ride.  So we want to make sure that this revolution in technologies and content continues to thrive and evolve to the benefit of all consumers, all over the country, including in rural communities in Iowa." 

Small internet service providers have expressed  concerns  that they might lose their customers because AT&T will be able to propose their subscribers limitless streaming of its own content. This will become a disadvantage on their part. 

AT&T CEO Stephenson  said that he is expecting a fair review of the merger  by the Justice Department.  However, he added that he had not met with Trump's transition team on the matter.