Blockbuster Media Deals Hinge On AT&T, Time-Warner

Two titans — the U.S. Justice Department and telecommunications giant AT&T Inc. — are locked in a high-stakes showdown to decide who controls some of the nation's most popular television channels, according to The LA Times.

The Justice Department sued to block AT&T's planned $85-billion purchase of Time Warner Inc., the New York media company that owns HBO, CNN, TNT, TBS, Cartoon Network and Hollywood's largest movie and TV studio, Warner Bros. The dispute — a rare standoff in an antitrust case — will be decided by a federal judge after a trial that begins Monday in Washington, barring a last-minute settlement.

The government alleges that AT&T, which already owns the nation's largest pay-TV provider, DirecTV, would use its added clout to bully others, freeze out new entrants in the TV industry and increase rates for consumers. The Dallas phone company scoffs at such concerns, saying the prices for TV service should go down — not up — if AT&T wins its prize.

Experts say that if AT&T prevails, the trend of media consolidation probably will accelerate. A loss by AT&T could chill the market for blockbuster media mergers.

The case also could help shape how traditional television is incorporated into mobile phone offerings. AT&T wants to use CNN, HBO and other networks as incentives to keep customers on their mobile phones. The company also has said it could produce bigger profits by weaving advertising messages relevant to consumers into content streamed on phones.

In the run-up to the trial, there has been much speculation over whether President Trump is behind the government's effort to scuttle the AT&T-Time Warner deal. Trump has long been opposed to the merger, first denouncing it in October 2016, when the deal was announced. Since arriving in Washington, Trump has threatened to use the Justice Department to punish political rivals, such as Hillary Clinton, and he has long groused about CNN's unflattering coverage of him. During a campaign rally last weekend in Pennsylvania, the president again belittled the channel, calling it "fake as hell — the worst."

Last week, a group of prominent former Justice Department officials, including former Nixon White House Counsel John Dean, former U.S. Atty. Preet Bharara of New York and former Immigration and Customs Enforcement Director Sarah R. Saldaña, sounded an alarm. In a court document, they said White House meddling would amount to selective law enforcement, which is unconstitutional. Both Bharara and Dean are paid CNN analysts, but they said they were speaking for themselves, not the cable network.