AT&T CEO Stephenson expects DOJ appeal of Time Warner deal approval will fail
Now that the Justice Department has decided to appeal the ruling of U.S. District Judge Richard Leon, who gave the AT&T purchase of Times Warner three thumbs up (not only did he warn the DOJ not to appeal his ruling, he approved the transaction without requiring any concessions from AT&T), you might expect to see Randall Stephenson a little concerned at the least. But no, AT&T's CEO appeared confident when he spoke to CNBC on Friday.
During his interview with the business cable channel (click on the video at the top of this article), Stephenson said that even with the appeal, his focus is on executing the telecom giant's plans. The executive talks like that because he feels that the chances of having the approval overturned is slim. "The merger is closed. We own Time Warner," Stephenson told CNBC viewers. And that is true. The ink wasn't even dry on Judge Leon's signature when AT&T closed on its $85.4 billion purchase the very next day after the ruling was made. The closing took place after the DOJ decided not to issue a stay on the transaction after Judge Leon's ruling, which cleared the way for AT&T to gobble up a ton of content.
The transaction gives AT&T ownership of the Times Warner movie studio and a library of amazing films including the Batman and Harry Potter series. It also gave the nation's second largest wireless provider 10% ownership of streaming video app Hulu. Now belonging to AT&T are cable networks CNN, HBO and others. Thanks to the purchase of Time Warner, AT&T has already started to offer a streaming video app called "AT&T Watch TV," which Stephenson characterized as a "very, very skinny bundle" of television programming. It includes programming from newly acquired TNT, TBS, TCM, Cartoon Network/Adult Swim, Boomerang and TruTV (Yes, that's the network that runs the hilarious Impractical Jokers nearly 24 hours a day). The app is free to AT&T subscribers with an unlimited data plan, and is priced at $15 a month to others.
But AT&T is not winning any brownie points with the public. Since the merger was closed, the company raised the price for its DirecTV Now app and for its unlimited service. It was also revealed how several AT&T locations were engaged in questionable sales tactics related to selling subscriptions for DirecTV Now.
Someone who is not a fan of the transaction is President Donald Trump. During the presidential campaign, when the deal was first announced by AT&T, Trump said that if he won the election he would block the deal. So we wonder if the president was behind the decision to appeal Judge Leon's ruling, especially since the DOJ was apparently content not to issue a stay on the transaction after the court approval. Don't forget that the president's favorite media target, CNN, is included in the deal, and AT&T's Stephenson points out in his interview that many legal experts cannot seem to find a basis for the DOJ lawsuit in the first place. Stephenson was asked whether the DOJ's attempt to block the deal, and the subsequent appeal, were politically motivated. He said that he would leave that speculation to others.