Telecommunications giant AT&T clashed with the U.S. Justice Department this Wednesday after antitrust regulators requested the company sell Time Warner’s CNN cable network. The Department imposed hefty conditions as a result of the carrier’s wish to acquire the Time Warner conglomerate. AT&T is opposing these regulations.
AT&T’s chief financial advisor, John Stephen, claims such obstacles imposed by the government would make an end of the year buyout less likely. Sources confirmed AT&T’s willingness to sell CNN, however, Chief Executive, Randall Stephenson, denied having agreed to any deal.
„I have never offered to sell CNN and have no intention of doing so” Stephenson stated.
However, it was later alleged by two Justice Department officials that it was Stephenson who proposed the strategy. They also stated that such a sell would not be enough to alleviate antitrust concerns.
Trump doesn’t like the deal
According to people from both sides, one of the main issues in the dispute stems from President Trump’s attitude towards CNN. He frequently attacked the news outlet describing it as a „fake news” organization. He has criticized the deal in the past, a notable example being in a speech he held during his 2016 presidential campaign in Gettysburg, Pa.
„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.”
White House Deputy Press Secretary, Raj Shah, claims Trump to not have spoken with the Justice Department in regards to the deal.
If the Time Warner deal is approved
In order for the $85 billion deal to be approved, the U.S. Justice Department demanded significant asset sales. This would include either CNN’s parent Turner Broadcasting or AT&T’s DirectTV satellite TV operation which they bought two years ago. Both AT&T and Time Warner executives dislike the idea of selling DirectTV due to its crucial role in a combined conglomerate.
The company would become one of the largest providers of cable TV in the United States if the Time Warner deal comes to fruition. This, in turn, would render the telecommunications juggernaut an owner of a large portion of news and entertainment outlets. Besides CNN’s parent Turner Broadcasting, Time Warner also owns Warner Bros movie studio as well as HBO.
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