This week, a federal judge approved the AT&T Time Warner merger, setting off reverberations throughout the Internet and entertainment industries. Note the “Time Warner” in this case owns HBO, TNT, TBS, CNN, Turner Classic Movies, Warner Bros, and a host of other pay-TV channels. Remember, Time Warner Cable merged a few years ago with Charter Communications creating Spectrum.
We point out this fact because some media pundits still get confused about the parties involved. News about the merger appeared all over the news media, with Telecompetitor being one of the sources able to get things right. Let’s take a closer look at how the AT&T Time Warner merger might affect your home Internet service.
No Conditions attached to the AT&T Time Warner Merger
Somewhat surprisingly, U.S. District Judge Richard Leon attached no conditions to the merger between AT&T and Time Warner. The judge also effectively prevented the Justice Department appealing the ruling, by announcing a denial to stay the merger’s closing if appealed. AT&T actually closed on the $85 billion Time Warner purchase last night.
AT&T chief, Randall Stephenson felt positive on the vertical merger being approved. He noted that AT&T and Time Warner aren’t competitors in the same industry. If AT&T purchased Time Warner Cable, on the other hand, conditions would have likely applied.
Still, the fact Comcast dealt with some conditions when purchasing NBC Universal raised the eyebrows of a few. These included licensing of the NBC Universal content to competing online providers. What the lack of conditions for AT&T means is unknown at this point.
What to expect from the Merged AT&T Time Warner
The most obvious change ushered in by the approval of the AT&T Time Warner merger is the feeding frenzy for other content creators. Expect Comcast and Verizon to hunt for purchase options, raising the stock prices for these media creators. 21st Century Fox and Discovery Communications are two likely targets.
For its part, AT&T hopes to leverage Time Warner to create new offerings to keep customers in the fold. Perhaps a zero rating (data cap free) HBO package is also in the company’s plans? Attracting new subscribers to DirecTV, DirecTV Now, or U-verse using that strategy makes sense.
Some industry watchers worry about these large ISPs eventually instituting data caps for content from other sources. This likely includes Netflix. In the wake of the Net Neutrality repeal, this is a possibility. Consumers need to keep a clear eye and read the fine print before signing on with a new ISP.
There’s no denying the media landscape changes greatly after the AT&T Time Warner deal. If it leads to increased competition, boosting the adoption rate of 5G technology, everyone benefits. Whatever happens, keep an eye on Bandwidth Place as we help you get the most from your home Internet service.