Time Warner assets like CNN helped the company overcome the federal government’s challenge to its merger with AT&T, the Department of Justice’s antitrust chief suggested on Wednesday.
“We don’t have a 24-hour dedicated news channel to go out and spin our case to the American public and judges and others as some merging parties might,” assistant attorney general Makan Delrahim said on the Marketplace Morning Report. A CNN spokeswoman didn’t immediately respond to request for comment.
Delrahim’s comment is noteworthy, given the Justice Department’s review of further mergers involving media assets, including a proposed combination of T-Mobile and Sprint and a deal between 21st Century Fox and Walt Disney Co. or Comcast. While experts predict the federal government’s loss in the AT&T-Time Warner case will spur a wave of consolidation between entities like content creators and distributors, Delrahim argued the decision doesn’t directly equate to less antitrust enforcement.
“It depends on if other judges follow the same evidentiary rulings this particular judge did and also dismiss the types of evidence we presented,” he said. “I think eight out of 10 judges may have treated this case differently.”
The Department of Justice’s fight against the Time Warner decision was somewhat unique, since it involved a so-called vertical mergers of companies at different points in the supply the chain.
While the federal government historically has not challenged such transactions, regulators said this one would would lead to higher costs for consumers. Proponents, meanwhile, argued the move was necessary for the two companies to compete effectively against tech giants like Amazon that are investing heavily in content.
Delrahim said the antitrust division’s job isn’t necessarily to prevent companies from getting too large, but to prevent “practices that harm competition, which ultimately harms consumers.”
Some industry experts question whether the Justice Department can effectively police the wave of media consolidations and whether it needs to modernize its review system.
While Delrahim argued stability and predictability is necessary for businesses, he noted the agency’s thinking has evolved on issues such as loyalty rebates and the bundling of certain services.
