On October 22nd 2016, AT&T agreed to buy Time Warner Inc for $85.4 billion. Time Warner owns multiple media properties which include HBO, CNN, Warner Brothers, TBS, TNT and others. The sale of Time Warner follows the deal that brought Comcast and NBC/Universal together and serves to further consolidate the communications and entertainment industries.
With the growth of wireless beginning to slow, AT&T has been looking to expand into the entertainment business. In 2015, it acquired Direct TV for $49 billion. It recently announced that it will be releasing its own Direct TV Now, live TV streaming service. The service will offer 100 channels for $35 month and will allow AT&T an opportunity to compete with other streaming services such as Netflix, Hulu and YouTube.
While this would potentially be the largest media deal in recent memory, it still has to be approved by federal regulators. This could take as much, if not more than a year, as did the Comcast/Universal deal. Some competitors are already sounding the alarm bell. However, AT&T has played down the possibility of a regulatory roadblock, citing that the company is not eliminating a competitor, but acquiring a supplier.
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