Senate Antitrust Leaders Advise Consumer-Focused AT&T/DirecTV Review

Pan summer hearing on proposed merger
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The chair and ranking members of the Senate Antitrust, Competition Policy and Consumer Rights subcommittee have advised the Justice Department on their competition policy positions regarding the vetting of the proposed AT&T/DirecTV merger, and it is to focus on consumers, including the deals effect on price, choice, quality and innovation.

They also plan to hold a subcommittee hearing on the deal sometime in the summer.

In a letter to FCC chairman Tom Wheeler and William Baer, assistant attorney general for antitrust, Sens. Amy Klobuchar (D-Minn.), chair, and Mike Lee (R-Utah), urged them to gauge the impact on consumers.

Justice will review for antitrust issues, while the FCC's review extends to public interest benefits as well as harms.

"AT&T and DirecTV state that their merger will create a 'competitive alternative to cable for consumers wanting a better bundle of top-quality broadband, video and mobile services, as well as a better customer experience and enhanced innovation," the senators wrote. "The companies further state that increased scale will allow the merged entity to realize cost synergies. As you review this transaction, we believe it is important to validate and weigh these efficiencies against the potential competitive harms that could result from the transaction."

That is pretty much a description of the combined review the FCC and DOJ are charged with conducting.

AT&T announced May 18 it was proposing a $67.1 billion debt and equity offer for DirecTV. It pledged to expand high-speed broadband to 15 million customers, mostly in rural areas, as well as offer stand-alone broadband, pledge nationwide pricing for DirecTV, a commitment to abide by FCC's 2010 network neutrality rules whether or not they are restored, and to bid big bucks in the broadcast incentive forward auction—at least $9 billion and perhaps much more.

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