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Opening Arguments Begin In AT&T And Time Warner Merger Case

Mar 21, 2018
Originally published on March 23, 2018 5:16 am
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DAVID GREENE, HOST:

For the moment, let's turn to another story now. The telephone and Internet giant AT&T wants to buy the media conglomerate Time Warner. President Trump has opposed this $85 billion deal, and the U.S. Justice Department is in federal court to try and stop it. The opening arguments are scheduled to begin this week. NPR's David Folkenflik reports that the judge in the case says this has to be decided on its own merits.

DAVID FOLKENFLIK, BYLINE: AT&T has expanded and contracted like an accordion over the course of its 180-year history. Right now, AT&T is huge again and looking to get bigger. As a candidate, the president was far from subtle about his feelings about that.

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PRESIDENT DONALD TRUMP: AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it's too much concentration of power in the hands of too few.

FOLKENFLIK: And you might reasonably think, well, that's a fair reflection of what candidate Trump had said about elites, power, swampy swamp, that sort of thing. But here's what he said just seconds earlier.

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TRUMP: The dishonest mainstream media is also part and a major part of this corruption.

FOLKENFLIK: Time Warner owns CNN, which raises the spectre of government policy based on a dislike of the media. The lawyer arguing the government's case says that's not the point. Antitrust law tries to ensure that consumers have choices. When companies control too much, there's little room for competition. Consumer advocate Gigi Sohn agrees. She's former counselor to the then-chairman of the Federal Communications Commission under President Obama.

GIGI SOHN: So if we return to a place where, you know, there's a presumption that big is bad - bad for democracy, bad for consumers - I think that's a good place for antitrust law and antitrust enforcement to be.

FOLKENFLIK: Sohn points to the acquisition of NBC Universal by Comcast. She says Comcast has the incentive and ability to favor its own programming. AT&T owns satellite television provider DirecTV, and it says it would be counterproductive to favor Time Warner channels. Sohn says she's not so sure.

SOHN: I mean, we're talking about TNT, CNN, HBO. This is some of the most-popular programming on cable today.

FOLKENFLIK: The AT&T case is remarkable because it involves what's called vertical integration, the combination of companies in related fields which don't compete directly. Randy Milch was executive vice president for public policy and general counsel for the telecom giant Verizon.

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RANDY MILCH: I would bet that the thinking was a high probability that the administration would do nothing.

FOLKENFLIK: It's been decades since any administration has made this argument in court. Milch says Time Warner faces plenty of competition in Hollywood and beyond.

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MILCH: I think you see, across the spectrum, entities piling a huge amount of money into creating original content - Netflix and Amazon, Disney. I think that the notion that there is some must-see aspect to Time Warner's content, I don't see it.

FOLKENFLIK: Milch says a judgment against AT&T may well ice future corporate deals. David Folkenflik, NPR News.

(SOUNDBITE OF EVIL NEEDLE'S "VIBIN") Transcript provided by NPR, Copyright NPR.