In probably the biggest deal of this decade where U.S Telecom Giant AT&T wanted to acquire the Time Warner – an American multinational mass media and entertainment conglomerate, has been finally being sealed, when the AT&T managed to win an antitrust lawsuit that was filed by the Justice Department of United States of America.
AT&T, one of the world’s largest telecom company, also the second largest service provider of mobile communication services wanted to acquire Time Warner in hopes to ‘compete’ with their online streaming services such as Amazon and Netflix. The deal was a total $85.4 billion but ended up to a whopping total of $108 billion including all the debts Time Warner had. Discussions around this deal began in 2016 but the Trump administration was not in support, as they claimed this acquisition would harm the end consumers in some way. The courts have cleared AT&T of any charges, and the deal has been finalized. Experts believe, after this deal, a lot of ‘content distribution’ companies are going to try to acquire new production houses. The Trump administration has two months to file for an appeal and is looking at all possible options. The Justice Department argued that this would reduce the number of ‘players’ in the market, and may lead to an increase in prices. Judge Richard Leon, however, didn’t seem to think on the same lines as the U.S Justice department as the deal was approved by him without any condition.
About AT&T & Time Warner
AT&T was formerly known as Southwestern Bell Corporation and was founded in 1983. Headquartered in Dallas, Texas it is one of the largest company in Telecommunications and Mass Media production. It serves customers worldwide by providing the following services:-
Fixed Line Telephone
The following companies are subsidiaries of AT&T
AT&T Digital Life
AT&T Sports Net
Otter Media (50%)
Game Show Network (42%)
Home Box Office, Inc.
Turner Broadcasting System
Before the recent acquisition, Time Warner was the third largest world’s entertainment company who owned brands like HBO, Turner Broadcasting Systems, and several others.
Reason To Acquire Time Warner
AT&T has been in Media and Content business for a while now and they have built up plenty of resources to expand its current operations. In 2016 AT&T bought DirecTV for $49 Billion, which included millions of its customers, along with some valuable agreements. Now that AT&T has acquired Time Warner, it will own some great original high-quality content. The cost of Content & Media has risen drastically in the recent past, making it quite difficult for end consumers to pay for such specialist services. The decision to acquire Time Warner was indeed a good one from a ‘cost-effectiveness’ perspective. Time Warner has definitely been a profitable ‘buy’ as it has constantly raised the value by helping rather underperforming businesses like AOL and a few others, and has created lucrative high-quality Video Content. This recent deal has caused quite a hype within the Entertainment industry, as AT&T’s Network and Resources together with Time Warner’s, is surely going to produce something great for consumers to look forward to.