The proposed merger of AT&T and Time Warner, an $85.4 billion affair, has been the subject of an insane amount of controversy, and for good reason. It would mark one of the biggest mergers of a media company and a service provider in history, and given Time Warner's content and subsidiary portfolio, the potential for harm to consumers and competition is absolutely huge. The deal has been publicly decried by net neutrality proponents and even some public figures, but as with any other such deal, it legally has to have its day in court and a fair, objective look by government officials. Thus, it hit a Senate subcommittee for a recent hearing, and AT&T CEO Randall Stephenson took the stand to promise that the deal would be handled gracefully, and in a way that would not bring undue harm to competitors or consumers.
According to members of the Senate who were at the hearing, with Time Warner under their belts, AT&T could bring iconic programming like WB and HBO under their heel, keeping it exclusive to their subscribers or charging others far more than they're currently paying to feature the programming. Wielding full control of Time Warner's library, AT&T would essentially have the power to begin the compartmentalization of content that net neutrality principalists have warned and fought against for years. According to AT&T CEO Randall Stephenson, however, none of this is going to happen.
Stephenson said, essentially, that fulfilling those fears would severely impact Time Warner's business to benefit AT&T, and that he would not have considered laying out such a huge sum of cash and assets for the purchase if he planned to simply gut Time Warner. Instead, Stephenson wants to grow Time Warner in its current form, while using its content and properties to the benefit of AT&T, helping to bring in and keep subscribers with easy and relatively cheap access to all of the iconic media in Time Warner's portfolio. AT&T reportedly wants to zero-rate the content for subscribers, just as it has with DIRECTV NOW, and distribute the content as widely as possible, pulling revenue for Time Warner from every single customer in every single market that they can possibly reach. Time Warner CEO Jeff Bewkes echoed Stephenson's sentiment, and said that even a combined AT&T and Time Warner wouldn't have quite enough pull to raise prices without hitting significant barriers. Even given all of this, Senator Al Franken and others had numerous doubts. The merger did not get approved or blocked at this particular meeting, so only time will tell if it will go through and how it will be handled if it does.