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Genachowski Doesn't See Government Winning AT&T-Time Warner Suit

Former FCC chair says it would be potentially chilling if telco divested to settle 11/20/2017 11:18 PM Eastern Last updated at 11/21/2017 4:45 AM

Former FCC chair Julius Genachowski is no fan of the Trump Justice Department's decision to sue to block the AT&T-Time Warner merger.

“This lawsuit creates unprecedented uncertainty for media companies thinking about scaling in this new media world where they have to compete with multiple large tech companies," Genachowski, now a partner and managing director of the Carlyle Group, told B&C/Multichannel News. "And it could be a bad sign for the tech companies as well."

He said it was difficult to know exactly what was behind the suit. "Could be the belief that DoJ should impose only structural remedies [DOJ antitrust chief Makan Delrahim was making a case for divestitures over behavioral conditions last week]," he said, "though it's hard to unsee the President’s comments on the deal [candidate Trump vowed to block it], and confusing that the FCC is moving in the opposite direction, removing structural remedies on media ownership." The FCC under chairman Ajit Pai has just voted for some major broadcast deregulation.

“This isn’t the last chapter," said Genachowski. "I don’t see the government winning this lawsuit; too far a departure from precedent and the facts since deals like Comcast/NBCu were approved with conditions, though even the unlikely can happen in court."

Genachowski said the tougher question is whether AT&T "would consider a divestiture to put the matter behind them. Possible, though unfair and potentially chilling.”

AT&T CEO Randall Stephenson indicated Monday (Nov. 20) that he would not be divesting just to get the deal past Justice, though he said AT&T would continue to try and find a way to secure DOJ approval.

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