AT&T, Time Warner Merger Looks Likely Under Trump Administration

AT&T reportedly feels confident its merger with Time Warner will be approved under the Donald Trump administration.

AT&T feels confident about its pending purchase of Time Warner following a meeting with the transition team of President-elect Donald Trump, a report from the Financial Times has indicated.

According to the report, the Trump administration plans to scrutinize the proposed merger of the massive communications company and programming entity that owns CNN and HBO, but will do so "without prejudice." The talks apparently left the heads of AT&T feeling confident about the likelihood the deal would pass regulatory muster.

The newfound confidence in the $85.4 billion deal may come as a surprise given Trump's fiery campaign rhetoric, in which he regularly rallied against the purchase, positioning himself as an adversary to the type of consolidation of power that would take place.

"As an example of the power structure I'm fighting, 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," Trump said during a campaign speech on October 22.

Just over a month later, the report from Financial Times may indicate President-elect Trump has softened his views.

The members of the transition team who oversee the Federal Communications Commission (FCC) may have been the first signal the AT&T-Time Warner deal would be a go under President Trump. Two of the appointees—Jeffrey Eisenach and Mark Jamison—have served as lobbyists for telecommunications companies in the past.

This week, the two were joined by American Enterprise Institute scholar Rosyln Layton. All three have been outspoken opponents to net neutrality.

Jamison's views are of particular interest regarding the future of the AT&T-Time Warner deal. The former Sprint lobbyist has suggested there is rarely such a thing as a telecommunications monopoly and believes the FCC has outlived its purpose.

"Most of the original motivations for having an FCC have gone away," Jamison wrote in an October 2016 blog post. "Telecommunications network providers and ISPs are rarely, if ever, monopolies. If there are instances where there are monopolies, it would seem overkill to have an entire federal agency dedicated to ex ante regulation of their services."

Eisenach, who once served as a consultant for Verizon, has similar views on the role of the FCC, which may indicate a more hands off approach to regulating deals like AT&T's purchase of Time Warner.

Joshua Wright, a law professor who has been tapped to lead the transition of the Federal Trade Commission, has also shown to be favorable toward telecom consolidation. In an opinion piece for the New York Times, Wright argued the "new antimerger fervor" is based upon the presumption that mergers lead to higher prices and worse services, which he called "demonstrably false."

While none of Trump's appointments indicate a sure-fire approval for AT&T's bid for Time Warner, it does signal the incoming administration will be friendlier to telecom dealings than Obama's FCC. During the Obama presidency, AT&T was blocked from buying T-Mobile and was warned about behavior that may have violated net neutrality. The FCC under President Obama also blocked Comcast's attempted purchase of Time Warner Cable—a separate entity from Time Warner—in 2015.

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