U.S. telecommunications firm AT&T’s proposed US$85 billion takeover of media giant Time Warner generated skepticism among both Democrats and Republicans Sunday, making it more likely that regulators will closely scrutinize the effort to create a new telecommunications and media giant.
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The biggest deal of the year, announced just over two weeks before the Nov. 8 U.S. election, is a gamble on a victory for Democratic presidential candidate Hillary Clinton and a continuation of the status quo on antitrust laws.
Those laws regulate the conduct of U.S. businesses and corporations to maintain fair competition for the benefit of consumers. The Republican presidential candidate Donald Trump, who is trailing Clinton in the polls, said he would block the takeover if elected president.
"AT&T, the original and abusive 'Ma Bell' telephone monopoly, is now trying to buy Time Warner and thus the wildly anti-Trump CNN. Donald Trump would never approve such a deal because it concentrates too much power in the hands of the powerful few," Trump economic advisor Peter Navarro said in a statement Sunday.
Clinton, who has expressed misgivings about other corporate mega-mergers, has not yet commented on the takeover.
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But Senator Bernie Sanders, Clinton's former rival for the Democratic party's nomination, said on Twitter the administration should "kill" the Time Warner takeover because it would mean higher prices and fewer choices for consumers.
Sanders' comments carry weight because Clinton needs Sanders' coalition of young and left-leaning voters to propel her to the presidency.
The cash and stock deal brings together two very different companies — one a telecoms company that traces its roots back to Alexander Graham Bell, the other an entertainment company founded in the Hollywood of the 1920s.
But the merger, which is designed to boost the content AT&T can stream over its network, raises concerns that AT&T might try to limit distribution of Time Warner material.
Some consumer advocacy groups suggested that competitors such as NBCUniversal, Twenty-First Century Fox and Walt Disney could find their content at a disadvantage.
The Senate subcommittee on antitrust will hold a hearing on the acquisition sometime in November, said subcommittee chair Senator Mike Lee, a Republican, and the ranking Democrat, Senator Amy Klobuchar. The justice department, not the president, has the power to reject such a deal if it violates antitrust laws.