FCC Distancing Itself From AT&T And Time Warner's Merger

The Federal Communications Commission (FCC) is distancing itself from the possible merger of AT&T and Time Warner in a move that might signal the controversial deal will go through at some point in the near future. On Monday, the new FCC Chairman Ajit Pai said how he doesn't believe the agency has a role to play in AT&T's acquisition of Time Warner that's reportedly valued at approximately $85 billion. The Trump-appointed Commissioner explained how the merger of the second largest wireless carrier in the United States and the New York City-based entertainment conglomerate is structured in a way that avoids transfer of airwave licenses, thus not warranting a review by the FCC.

Pai commented on the deal in an official capacity, adding how he doesn't believe the merger will even be presented to the FCC as there's no reason for it. His comments clearly imply that the U.S. Department of Justice (DOJ) will be the only federal agency that will scrutinize the controversial deal that critics have described as a massive antitrust issue in the making. Pai also revealed that the FCC and the DOJ haven't interacted on the matter since he took office. While the FCC was originally expected to scrutinize the deal, chances of that happening became slim after Time Warner sold its Atlanta TV station to Meredith Corporation last week, thus removing a major factor that could have prompted the Commission to review the deal. The sale — estimated to be worth around $70 million — was reportedly made for the specific purpose of facilitating the conglomerate's merger with AT&T.

Industry analysts who previously speculated that AT&T's acquisition of Time Warner will break down were mostly counting on the FCC investigating the deal seeing how a potential probe by the telecommunications watchdog would have likely been much more thorough than the one that's currently being conducted by the DOJ. However, Pai's recent comments serve as a strong indication how that scenario won't happen. Coincidentally, this turn of developments is in line with what AT&T's CEO said he was expecting earlier this month. Given the current state of affairs, it's possible that the merger will take place sooner than anticipated. An update on the situation is expected to follow by spring.

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