US regulators are to examine AT&T’s acquisition of Time Warner following concerns from a number of US lawmakers and both presidential candidates.
On Saturday AT&T, the US’s third largest cable provider, announced that it is buying Time Warner for $85.4 billion (£70 billion); however, regulators must now consider whether the merger is fair to other US operators.
If approved, it will be the biggest merger of 2016 – combining Time Warner’s portfolio of content with AT&T’s distribution network, which includes 130 million mobile phone customers and 25 million pay-TV subscribers.
Republican Senator Mike Lee, who chairs the antitrust subcommittee, said the deal would “potentially raise significant antitrust issues” which the subcommittee will examine carefully in a hearing next month.
A spokesperson for the Democratic presidential candidate Hilary Clinton said there were a number of questions and concerns that need to be scrutinised, while Republican candidate Donald Trump said he would block the merger if he wins because it would be “too much concentration of power in the hands of too few”.
AT&T’s chief executive, Randall Stephenson, said he believes regulators will approve the deal.
Bloomberg Intelligence analyst Erhan Gurses said the deal will “embolden” some of Europe’s telecom operators’ pursuit of content.
“The content strategies of Europe’s telecoms companies vary, with BT buying premium sports, Telefonica acquiring the largest Spanish pay-TV operator and Vodafone partnering with content providers,” Gurses said.
“However, majority so far remained passive distributors of content.”
