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Leahy Gives AT&T/DirecTV Deal a Wary Eye
Posted at 12:07 p.m. on May 19, 2014
The chairman of the Senate Judiciary Committee sounds skeptical about AT&T’s plan to buy DirecTV. In a statement this morning, Sen. Patrick J. Leahy, D-Vt., said:
DirecTV is a nationwide competitor with cable and plays an important role in providing television service to rural areas like Vermont. With this latest proposed merger, I am concerned that the telecommunications marketplace is trending even further toward one that favors big companies over consumers. I will closely monitor the FCC and the antitrust authorities’ response to this announcement. The Senate Judiciary Committee will be looking closely at this transaction.
Leahy’s statement had a slightly sharper tone than the joint statement from Republicans and Democrats on the House Judiciary Committee, which is planning a hearing on the merger:
Yesterday’s announcement of the proposed merger between AT&T and DirecTV comes on the heels of the House Judiciary Committee’s review of the Comcast and Time Warner Cable merger. The proposed AT&T and DirecTV merger would be the fourth largest telecommunications merger in history. The Committee has a strong record of reviewing proposed transactions that could have a significant impact on consumers and the competitive marketplace. We intend to continue that record by conducting a hearing to examine the proposed AT&T and DirecTV merger to ensure that consumers’ interests are protected in an increasingly consolidated telecommunications marketplace.
Vox’s Timothy B. Lee writes that the $48.5 billion purchase is “mostly about two things: economies of scale and bundling.”
Kevin Fitchard at Gigaom has more on bundling: “It wants to tie together as many of the two companies’ products and services as possible.”
Saba Hamedy and Amy Kaufman at the the Los Angeles Times reports on consumer and expert reaction and writes that:
The deals by Comcast and AT&T are expected to spark even more consolidation. Other companies seen as potential merger candidates include satellite broadcaster Dish Network, telecom giant Verizon and cable operator Cox Communications. … But any kind of dealmaking is being met with concern. There’s already growing consumer frustration with not just the lack of choice, but that rates will go higher with just a handful of companies controlling pay TV.