AT&T is buying Time Warner and reportedly for a price which exceeds $80 billion. At least, that is the plan. AT&T made the announcement on their intent to buy back towards the end of October and ever since, debate has raged over whether the deal will be able to go through. Such a merger would give AT&T a clear route into the TV market, which is something that the company clearly seems intent on and especially following their subsequent announcement detailing their plan to offer a new DIRECTV service for $35 per month, which gives the customers access to more than 100 channels. Needless to say, the assumption is that many of the tier 1 channels could come as a result of that purchase of Time Warner.
Well, it now as looks as though there are some official complaints starting to surface over AT&T's plans as a new report out of Reuters today, details that they have seen a letter sent from the U.S. Federal Communications Commission (FCC) to AT&T. While the bulk of the contents of the letter have not been revealed, the important bits have and that is that the FCC has "serious concerns" over the $35 per month DIRECTV service. The reason being, it could price competitors out of offering competing services.
As you might expect, the logic behind this is that the new AT&T service could be falling foul of the FCC’s net neutrality regulations. What the FCC particularly are concerned about is whether the service (which will also be accessible via a free and zero-rated app) will prove to be significantly more affordably than competing services. While that sounds good from the consumer point of view, as cheaper is better, the issue is that if other companies cannot compete, then the market no longer remains 'fair'. As the current reports notes, the letter is said to state that the service "may obstruct competition and harm consumers". As a result, it also seems to be the case that the FCC has given AT&T until November 21 to reply to the letter and its criticisms and presumably, explain how the service will not be in breach of those net neutrality regulations.