In the biggest deal in the world this year, U.S telecom giant AT&T has announced buying Times Warner for 85.4 billion dollars. If the deal gets regulatory approval, the telecom giant will be able to stream the content of CNN, HBO and Warner brothers across its network. On the contrary, critics have warned that potential merger if approved by regulators, might concentrate too much media power into one identity.
According to Guardian, AT&T CEO Randall Stephenson, who will run the combined company said,” The deal will allow AT&T to offer unique services, particularly on mobile” though he didn’t provide details. Jeff Brooks, the Time Warner CEO who will stay with the company for an undefined transition period, added that the money will help fund production of additional programming and films. What AT&T is buying is Time Warner’s vast library of content and ability to create new premium content that connects with audiences around the world, with AT&T ‘s extensive customer relationship, world’s largest pay-tv and subscriber base.
Merging two media giants could deprive the customer of choice and might be resisted by the regulators. BBC indicated the prospect of another media giant on the horizon has already drawn fire on the presidential campaign trail. Donald Trump has already said “ as an example of power structure that I am fighting, AT&T and Time Warner and thus CNN, a deal we will not approve in my administration because it is too much concentration of power in the hands of few
The proposed deal is the part of the trend. Five years ago telecom giant Comcast merged with NBC universal and last year AT&T bought DIRECT TV creating the largest Pay Tv Company in the United States The AT&T –Time Warner deal will need approvals from regulators which could take more than a year. One of the key issue regulators will consider is whether the merger will reduce competition leading to higher price and fewer choices for consumers