AT&T CEO Randall Stephenson could be feeling similar to Casey at the Bat as he anticipates a decision on whether his organization can purchase Time Warner. He’s down two strikes, and in the event that he comes up short this time, his heritage might be fixed.
A blocked Time Warner acquisition would be the third stumble for Stephenson on transformational bargains for AT&T. Despite the deal’s benefits, if Judge Richard Leon decides AT&T can’t purchase Time Warner, Stephenson’s endeavor to change the country’s second-biggest wireless supplier will once again fall flat.
The AT&T-Time Warner trial is entering its fifth week, and Stephenson is set to testify this week, as indicated by a man comfortable with the issue. The Department of Justice’s essential argument is AT&T could undermine to withhold Time Warner’s programming from various distributors to drive higher costs.
AT&T’s DirecTV is a compensation TV supplier that achieves in excess of 20 million clients. On the off chance that Leon trusts AT&T will undermine to withhold Time Warner programming from other video wholesalers, knowing clients could change to DirecTV as an option, he may choose an arrangement wouldn’t be to the greatest advantage of consumers.
AT&T counters that the rationale doesn’t hold up, as the purpose of owning content is to get widespread distribution, which brings in associate charges and advertising income. Time Warner likewise has contracts with existing TV administrators, bolting the organization into appropriation bargains for a considerable length of time to come.
In the event that Leon decides AT&T can’t purchase Time Warner, it will probably be because of AT&T’s earlier procurement of DirecTV — a double whammy for investors. Additionally, Time Warner could bolster DirecTV by helping AT&T keep together the packaging of channels — the money hearth of the compensation TV industry.
“Time Warner was one, every time you looked at it, you came back to it,” Stephenson said. “One area that drives engagement like nothing else is premium content. This company has had a lot of seminal moments,” Stephenson said Thursday, taking measure of AT&T’s storied history. “We are on the cusp of another one of these moments. The better you do on advertising, the less you have to charge consumers for the service.”