On Thursday night, soon after the Justice Department said it would not seek a stay of its antitrust lawsuit, AT&T completed its $85 billion acquisition of Time Warner. AT&T was anxious to close the deal by June 20, at which point Time Warner could withdraw or renegotiate its terms. A federal judge approved the merger on Tuesday.
The combination of AT&T, the No. 2 wireless carrier, and Time Warner's stable of content — including HBO, CNN, Warner Bros., TBS, and TNT — plus AT&T's DirecTV subsidiary will reshape the media and entertainment landscape. Only a handful of other internet companies control both the content and means to distribute it: Comcast owns NBCUniversal and is bidding for 21st Century Fox, and Verizon owns AOL and Yahoo. The Justice Department has 60 days to appeal its loss of the antitrust lawsuit, but experts suggest it would likely lose any appeal. Peter Weber
T-Mobile announced on Sunday it has reached a $26 billion deal to buy Sprint.
T-Mobile and Sprint are the third- and fourth-largest wireless companies in the United States. They tried to merge in 2014, but there was resistance from the Obama administration. Under the deal, T-Mobile CEO John Legere will lead the combined company, and it will keep the name T-Mobile. The companies said they want to hire more employees after the merger, especially in rural areas, and will focus on developing faster 5G networks. This will affect 127 million customers.
The deal must be reviewed by the Department of Justice and Federal Communications Commission, and if approved, it's expected to close by the first half of 2019, The Associated Press reports. Catherine Garcia
On Tuesday, Comcast made a cash offer for Britain's Sky PLC, outbidding Rupert Murdoch's stalled attempt to purchase the European satellite TV giant by about 16 percent per share. Comcast's £12.50-a-share ($17.50) offer values Sky at $31 billion. "We think Sky is an outstanding company," Comcast CEO Brian L. Roberts said in a statement. "Comcast intends to use Sky as a platform for growth in Europe. We already have a strong presence in London through our NBCUniversal international operations, and we intend to maintain Sky's U.K. headquarters. Adding Sky to the Comcast family of businesses will increase our international revenues from 9 percent to 25 percent of company revenues."
Britain's competition regulator rules that Murdoch's purchase of Sky is 'not in the public interest'
On Tuesday, Britain's top competition regulator, the Competition and Markets Authority (CMA), provisionally rejected 21st Century Fox's bid to buy 61 percent of satellite broadcaster Sky because it is "not in the public interest." The CMA was looking at two questions — would the proposed merger lower broadcasting standards in Britain and would it give Rupert Murdoch and his family too much control over British media and opinion; it said no to the first question and yes to the second. Sky, owner of Sky News, and Fox will respond to CMA's objections and proposed workarounds, and Culture Secretary Matt Hancock will make the final decision by the middle of May.
Murdoch has been trying for years to purchase full control of Sky, which he launched in the early 1990s, and in December 2016 he made a $16.3 billion offer. But the CMA noted that the Murdoch Family Trust controls news outlets watched or read by nearly a third of the U.K.'s population. "Media plurality goes to the heart of our democratic process," Anne Lambert, chairwoman of the CMA's independent investigation group, told BBC News. "It is very important that no group or individual should have too much control of our news media or too much power to affect the political agenda."
The CMA said that to mitigate its media plurality concerns, 21st Century Fox could call off the deal, sell or divest Sky News, or put in place "behavioral remedies" to wall off Sky News from Murdoch Family Trust interference. Murdoch's sale of most 21st Century Fox assets to the Walt Disney Co., if completed, could also mitigate those concerns. Peter Weber
On Thursday, the Walt Disney Co. agreed to buy a passel of 21st Century Fox's movie and TV assets for $52.4 billion, giving Disney the 20th Century Fox and Fox Searchlight film studios and Fox television studio, FX, and the National Geographic Channel. Disney CEO Robert Iger will stay on as head of the combined companies through 2021, Disney also announced. The acquisition will require Justice Department antitrust approval. Analysts say that Disney wanted 21 Century Fox's content for its upcoming video-streaming services. The deal also gives Disney a 60 percent stake in Hulu. "It gives them a little more leverage to compete against new studios such as Netflix," says Boston College Law professor Dan Lyons, and "against cable companies to try to figure out they are going to continue to make money off the declining traditional cable bundle." Peter Weber
On Sunday night, magazine publisher Meredith Corp. reached a deal to buy Time Inc. for $18.50 a share, or nearly $3 billion, combining under one company Time's Sports Illustrated, People, Fortune, and Time with Meredith's Better Homes and Gardens and Family Circle, among other titles. The boards of both companies approved the deal, which is expected to close in the first quarter of 2018. Meredith, based in Des Moines, made a bid for Time Inc. in 2013 and expressed interest again earlier this year, but it was unable to raise the funds for the all-cash deal until the private equity firm of conservative industrialists Charles and David Koch stepped in with $650 million in financing.
Both companies date back to the early 1900s. Edwin Thomas Meredith entered the magazine business in 1902, with Successful Farming; Henry R. Luce and Briton Hadden launched Time Inc. in 1922, after working together at a Yale newspaper. Meredith said that Koch Equity Development will have no seat on the board and would "have no influence on Meredith's editorial or managerial operations," and some Koch allies say this is purely a financial investment, The New York Times notes, "but others familiar with the Kochs' thinking speculated that they could nonetheless use the media properties — which reach millions of online and print readers — to promote their brand of conservatism." Peter Weber
Fox News boss Rupert Murdoch has on more than one occasion expressed interest in buying CNN, Reuters reports. Murdoch reportedly reached out twice to AT&T CEO Randall Stephenson in the last six months, and one source told Reuters that Murdoch asked about buying CNN in both calls. Another source countered that Murdoch has "zero interest" in buying CNN.
The report of Murdoch's alleged interest in CNN comes two days after The New York Times and Politico reported that the Justice Department wanted to force a sale of Time Warner's Turner Broadcasting or AT&T's DirecTV before it would approve an $85 billion merger between Time Warner and AT&T. An anonymous news executive who spoke to The Daily Beast said Thursday that the DOJ's request was "politics plain and simple, and an incredibly brazen attempt at interference in a totally straightforward business deal." President Trump has long feuded with CNN and is said to speak to Murdoch on the phone frequently.
In 2014, Time Warner rejected an $80 billion offer to be purchased by Murdoch's Twenty-First Century Fox. On Friday, Vanity Fair's Gabriel Sherman reported that a person close to Murdoch claimed that the 86-year-old executive said that "he'd work behind the scenes" to stop the merger between Time Warner and AT&T. Kelly O'Meara Morales
On Monday, the right-leaning broadcast company One America News Network joined Newsmax and public interest and liberal groups in opposing Sinclair Broadcasting Group's proposed $3.9 billion purchase of Tribune Media, a merger that would expand Sinclair's market share of broadcast TV stations from more than 30 percent of U.S. households to 72 percent of households. Rupert Murdoch's 21st Century Fox is also reportedly threatening to pull Fox affiliate stations if the merger goes through, hitting Sinclair's stock price last week, and the American Cable Association and DISH Network have asked the FCC to require more information from Sinclair about how the merger would affect the public. Monday was the deadline for asking the Federal Communications Commission to block the deal.
Sinclair, which HBO topical comedian John Oliver recently called probably "the most influential media company that you've never heard of," has a notable conservative bent in the commentary and other "must run" segments its sends to its 170 local stations in 81 markets. If the merger is given the green light, Sinclair would add 42 more stations in 33 markets, giving it stations in seven of the 10 biggest U.S. markets.
Under U.S. law, broadcast TV companies are supposed to reach no more than 39 percent of U.S. households, but in April, soon after President Trump named him FCC chairman, Ajit Pai reinstated an antiquated FCC rule designed for UHF television stations that allows broadcast channels 13 and above to not be counted fully in calculating market share. Sinclair, which announced its purchase two weeks after Pai's 2-1 vote, argues that it needs to expand to better compete with cable TV giants and negotiate with other media behemoths. Sinclair and its executives have donated heavily to Republicans, and the company is not expected to face much resistance to its merger from the GOP-led Congress or Pai. You can read more about the FCC's involvement at Politico. Peter Weber