OT-AT&T To Buy Time Warner

[AshSaturday]

AT&T's is purchasing time warner in an $85 Billon deal. Does anyone know if the merger will add or cost jobs in NJ. I think a lot of the AT&T jobs left the area years ago for Phoenix. Temping for AT&T really helped while I was in school.

Will help AT&T get into programming.


http://money.cnn.com/2016/10/22/media/att-time-warner/index.html

 

[RU848789]

AT&T's is purchasing time warner in an $85 Billon deal. Does anyone know if the merger will add or cost jobs in NJ. I think a lot of the AT&T jobs left the area years ago for Phoenix. Temping for AT&T really helped while I was in school.

Will help AT&T get into programming.


http://money.cnn.com/2016/10/22/media/att-time-warner/index.html

Has there ever been an merger or acquisition that didn't lead to major to massive layoffs?

 

[nick614]

We'll see if it gets approved or not. Trump said today if he wins it won't.

 

[cubuffsdoug]

We'll see if it gets approved or not. Trump said today if he wins it won't.

The Feds will never let this go through. Didn't Verizon have to sell its share of Direct/ or Dish TV in order to offer Fios in more areas? They could offer both in the same area and it gave the public fewer options for cable/satellite TV. I sure someone here could give more info on this.

 

[rutgersguy1]

If Comcast can buy NBC, by that standard you'd think ATT can buy Time Warner. This is Time Warner not Time Warner Cable. It's a merger of content (HBO, Turner properties, Warner Bros, etc) and distribution with their DirectTV/UVerse properties and their wireless business.

It's not like when they got rejected from merging with TMobile some years ago. The rejection of that merger has been a boon for consumers with TMobile (and Sprint) continuously pushing the envelope on pricing.

That being said with a probable Clinton win and maybe a more Democratic leaning congress who knows what obstacles may lie ahead. I wonder what the breakup fee is. ATT lost a few billion in that TMobile failed merger IIRC.

 

[Leonard23]

Has there ever been an merger or acquisition that didn't lead to major to massive layoffs?

The correct term is merger synergies...

The Feds will never let this go through. Didn't Verizon have to sell its share of Direct/ or Dish TV in order to offer Fios in more areas? They could offer both in the same area and it gave the public fewer options for cable/satellite TV. I sure someone here could give more info on this.

Verizon never owned DirecTV or Dish. The DOJ has been unpredictable lately so who knows what they'll do. They could kill it like they did of AT&T's acquisition of TMO, or the DOJ & FTC will review & impose similar restrictions to or maybe more than what were imposed on Comcast when it acquired NBC Universal, which will be memorialized in a consent decree.

 

[BABYBULL24]

Monopoly much?

 

[rags]

AT&T's is purchasing time warner in an $85 Billon deal. Does anyone know if the merger will add or cost jobs in NJ. I think a lot of the AT&T jobs left the area years ago for Phoenix. Temping for AT&T really helped while I was in school.

Will help AT&T get into programming.


http://money.cnn.com/2016/10/22/media/att-time-warner/index.html

There were already layoffs in the works, with company asking for volunteers with out any incentive other than they plan to cut back the max severance (6 months) next year.

There has been no official announcement of the total layoffs, but they are widespread through out the company. Even a little outsourcing sprinkled in - one group with folks in piscataway has surplussed 100 people and are sending another 60 to Amdocs with only a 1 year guarantee on their job there.

 

[Leonard23]

If Comcast can buy NBC, by that standard you'd think ATT can buy Time Warner. This is Time Warner not Time Warner Cable. It's a merger of content (HBO, Turner properties, Warner Bros, etc) and distribution with their DirectTV/UVerse properties and their wireless business.

It's not like when they got rejected from merging with TMobile some years ago. The rejection of that merger has been a boon for consumers with TMobile (and Sprint) continuously pushing the envelope on pricing.

That being said with a probable Clinton win and maybe a more Democratic leaning congress who knows what obstacles may lie ahead. I wonder what the breakup fee is. ATT lost a few billion in that TMobile failed merger IIRC.

There's just as much or more of a DOJ & FTC concern when a content distribution company also tries to buy content. Trump has already said his administration would block this deal. According to Bloomberg:

Time Warner will pay a breakup fee of $1.72 billion if it walks away from the deal, while AT&T is liable for $500 million, according to a representative for AT&T.

I'm not sure what the breakup fee is, if any, if the deal isn't approved by regulators.

 

[rutgersguy1]

There's just as much or more of a DOJ & FTC concern when a content distribution company also tries to buy content. Trump has already said his administration would block this deal. According to Bloomberg:

Time Warner will pay a breakup fee of $1.72 billion if it walks away from the deal, while AT&T is liable for $500 million, according to a representative for AT&T.

I'm not sure what the breakup fee is, if any, if the deal isn't approved by regulators.

I had an easier time envisioning a rejection of the #2 and #3 wireless carriers in ATT/TMobile being rejected or the Comcast takeover of Time Warner Cable. This I have a harder time seeing being rejected especially in light of Comcast taking over NBC but like you said who knows, it's not out of the realm of possibility to be rejected.

With Verizon taking over Yahoo (still don't completely understand that one) and AOL, along with NBC in Comcast's house, we're seeing more of these type of get togethers between content providers and distribution.

 

[cubuffsdoug]

The correct term is merger synergies...
Verizon never owned DirecTV or Dish. The DOJ has been unpredictable lately so who knows what they'll do. They could kill it like they did of AT&T's acquisition of TMO, or the DOJ & FTC will review & impose similar restrictions to or maybe more than what were imposed on Comcast when it acquired NBC Universal, which will be memorialized in a consent decree.

Verizon never own a percentage of DirecTV?

 

[RU_Planning]

We'll see if it gets approved or not. Trump said today if he wins it won't.

The guy is a walking contradiction.

 

[Leonard23]

Verizon never own a percentage of DirecTV?

Nah. They have distribution deals & actually still sell DirecTV.

 

[nick614]

The guy is a walking contradiction.

How so?

 

[RU_Planning]

How so?

Lambasts regulation, but is going to stop a wireless carrier from acquiring a content provider just like his position on trade and tariffs.

I wonder if Trump knows that Time Warner isn't Time Warner Cable and they have nothing to do with each other.

The deal is way too complicated for Trump to flat out say he will reject it. However, I am sure that doesn't matter to his supporters.

 

[pmvon]

We'll see if it gets approved or not. Trump said today if he wins it won't.

Just like a true free market republican.

 

[knightfan7]

There were already layoffs in the works, with company asking for volunteers with out any incentive other than they plan to cut back the max severance (6 months) next year.

There has been no official announcement of the total layoffs, but they are widespread through out the company. Even a little outsourcing sprinkled in - one group with folks in piscataway has surplussed 100 people and are sending another 60 to Amdocs with only a 1 year guarantee on their job there.

I remember when a company I worked for sent employees a notice of a change (major cut) in the severance package. We all said "uh-oh". 4 months later......bingo.

 

[rutgersguy1]

I was reading that ATT wanted to get the deal finalized quickly and announced by Monday when news started breaking of their more involved talks this past week because of concern over other bidders like Alphabet (Google) and Apple.

I don't understand that myself. Not that Apple doesn't have the money to outbid ATT if they wanted but since when has Apple done such a transformational type deal. Beats for 3 billion a couple years ago is the biggest deal of theirs I can remember and frankly I thought the price tag for that seemed crazy. But it doesn't seem in their DNA to do such large deals. Even Netflix that's always rumored with them, and I think might actually be a good combo, seems unlike anything they've done in their past.

 

[RUinPinehurst]

Lambasts regulation, but is going to stop a wireless carrier from acquiring a content provider just like his position on trade and tariffs.

I wonder if Trump knows that Time Warner isn't Time Warner Cable and they have nothing to do with each other.

The deal is way too complicated for Trump to flat out say he will reject it. However, I am sure that doesn't matter to his supporters.

TWC is also a wireline service provider offering internet access/data and voice/phone, in addition to programming and cable TV. Remember the breakup of Ma Bell? Well, this acquisition would return AT&T to a monopolistic biz model, no? Hard to see how the deal would merit regulatory approval.

 

[RU_Planning]

TWC is also a wireline service provider offering internet access/data and voice/phone, in addition to programming and cable TV. Remember the breakup of Ma Bell? Well, this acquisition would return AT&T to a monopolistic biz model, no? Hard to see how the deal would merit regulatory approval.

Time Warner Cable was acquired by Charter Communications in 2015.

Time Warner spun off TWC at least 5 years ago.

Time Warner is a content provider, not a service provider.

Many people are confusing this.

 

[RUinPinehurst]

Time Warner Cable was acquired by Charter Communications in 2015.

Time Warner spun off TWC at least 5 years ago.

Time Warner is a content provider, not a service provider.

Many people are confusing this.

Got it. Thanks.

From NYT: "Over the last decade, Time Warner has spent significant time selling or spinning off AOL, many of the Time Inc. stable of publications, and Time Warner Cable, which was sold to another cable operator. The remaining businesses are HBO, one of the most-admired pay-TV channels; Warner Bros. movie studios; and cable channels that include CNN, TNT, Turner Sports and TBS."

Even more interesting? Regulatory monopolistic challenge would be over content/info.

 

[RU_Planning]

Got it. Thanks.

From NYT: "Over the last decade, Time Warner has spent significant time selling or spinning off AOL, many of the Time Inc. stable of publications, and Time Warner Cable, which was sold to another cable operator. The remaining businesses are HBO, one of the most-admired pay-TV channels; Warner Bros. movie studios; and cable channels that include CNN, TNT, Turner Sports and TBS."

Even more interesting? Regulatory monopolistic challenge would be over content/info.

Why though? AT&T isn't a content provider.

Are there any other companies that provider services and content? I can't think of one off of the top of my head.

 

[RUinPinehurst]

Why though? AT&T isn't a content provider.

Are there any other companies that provider services and content? I can't think of one off of the top of my head.

The challenge would be over the coupling of service and content. That's a powerful combo.

 

[rutgersguy1]

It's always possible the takeover could get rejected but as I said above if you use Comcast's buying of NBC from GE, this should be no different. That's the number 1 cable provider buying a major tv network, movie studio, etc.. You have Verizon buying up these smaller assets like AOL/Yahoo combining content and distribution albeit on a smaller scale. So it happens and actually seems to be the way things are going lately.

As I said this isn't an ATT/TMobile merger rejection combining the #2 and #3 wireless carriers or even Sprint's rejection of an attempt on TMobile combining #3 and #4 wireless carriers or Comcast trying to buy Time Warner Cable (not Time Warner) combining #1 and I think #4 at the time cable providers. There isn't really an overlap here. I mean Time Warner Cable was spun out of Time Warner but it's not like the gov't forced them to break up and that was content and distribution under 1 umbrella. We now have Comcast and NBC too. So if I had to guess I'd say it gets approval based on history but it's not a slam dunk. You have a likely Democratic president and possibly more Democratic congress so there may be more regulatory hurdles to get over.

 

[e5fdny]

As an AT&T stockholder what does this do for me?

 

[RU_Planning]

I can't tell you how many people I am hearing and reading give their opinions on this proposed merger have no idea Time Warner doesn't have anything to do with Time Warner Cable.

 

[LC-88]

Lambasts regulation, but is going to stop a wireless carrier from acquiring a content provider just like his position on trade and tariffs.

I wonder if Trump knows that Time Warner isn't Time Warner Cable and they have nothing to do with each other.

The deal is way too complicated for Trump to flat out say he will reject it. However, I am sure that doesn't matter to his supporters.

He probably remembers all the time, and money spent breaking up AT&T back in the late seventies/early eighties. Does not want the Death Star to be rebuilt.

 

[Kbee3]

We'll see if it gets approved or not. Trump said today if he wins it won't.

Tell him to calm down. The bookies in London are already paying off to those that bet on Hillary to be our next President.

 

[RU_Planning]

He probably remembers all the time, and money spent breaking up AT&T back in the late seventies/early eighties. Does not want the Death Star to be rebuilt.

Explain to me how a service provider acquiring a content provider is anything like Ma Bell.

 

[rutgersguy1]

As an AT&T stockholder what does this do for me?

My 2 cents. Short term there might be a little hit in the share price, likely some has priced in since news was leaking last week. There will also likely be some debt issuance (rates still low though) when you take into account the 40+ billion spent on DirectTv and now 80+ billion on Time Warner.

Long term though my personal opinion is that it's a good play and likely necessary. The big wireless carriers (ATT/Verizon) are being squeezed competitively on pricing by TMobile/Sprint offerings and there's been a trend towards cord cutting which would affect U-Verse/DirectTv. So bringing some content in house doesn't sound like a bad idea to me provided it's quality content. Time Warner is that IMO when you think of HBO, Turner properties, Warner Bros etc..Same for Comcast with NBC Universal. The Yahoo/AOL properties for Verizon I personally don't get other than the fact that they're obviously cheaper properties to acquire. I guess they didn't have the money or want to spend as much after buying back the 40+% of themselves controlled by Vodafone which cost Verizon 100+ billion IIRC.

In the end though regardless of what anyone thinks, time will tell if it was a smart acquisition or not. Some thought Disney paid hefty prices for Pixar, Marvel, Lucas when they acquired each but they've all paid off well for Disney.

 

[superfan01]

My 2 cents. Short term there might be a little hit in the share price, likely some has priced in since news was leaking last week. There will also likely be some debt issuance (rates still low though) when you take into account the 40+ billion spent on DirectTv and now 80+ billion on Time Warner.

Long term though my personal opinion is that it's a good play and likely necessary. The big wireless carriers (ATT/Verizon) are being squeezed competitively on pricing by TMobile/Sprint offerings and there's been a trend towards cord cutting which would affect U-Verse/DirectTv. So bringing some content in house doesn't sound like a bad idea to me provided it's quality content. Time Warner is that IMO when you think of HBO, Turner properties, Warner Bros etc..Same for Comcast with NBC Universal. The Yahoo/AOL properties for Verizon I personally don't get other than the fact that they're obviously cheaper properties to acquire. I guess they didn't have the money or want to spend as much after buying back the 40+% of themselves controlled by Vodafone which cost Verizon 100+ billion IIRC.

In the end though regardless of what anyone thinks, time will tell if it was a smart acquisition or not. Some thought Disney paid hefty prices for Pixar, Marvel, Lucas when they acquired each but they've all paid off well for Disney.

Curious what you do for a living. Your knowledge makes me think you are a TMT analyst.

 

[rutgersguy1]

Curious what you do for a living. Your knowledge makes me think you are a TMT analyst.

Nah what I do is far away from that kind of thing but I have been trading stocks for myself on the side for years so I like to at least have a rough idea of what's going on in whatever sector whether it be media, pharma, energy, tech etc.. So I've read and watched a lot of business news to keep myself abreast. Even been accused of regurgitating CNBC here in the past lol but whatever.

So if a business/stock oriented thread comes up I'll participate and give my 2 cents from time to time whether it be about conference realignment, sports tv rights or this kind of thing. I find it fun to talk about and like to read what other people are thinking too, that's all.

 

[Bleed_Scarlet]

TWC is also a wireline service provider offering internet access/data and voice/phone, in addition to programming and cable TV. Remember the breakup of Ma Bell? Well, this acquisition would return AT&T to a monopolistic biz model, no? Hard to see how the deal would merit regulatory approval.

Would also have been hard to see how United/Continental could have been approved given the complete domination of Newark (and some other airports), but it happened, and now airfares out of Newark are prohibitively expensive.

As a result, I now fly out of LaGuardia and JFK (at great inconvenience), whereas I never had to do this before that merger

Regulators are unpredictable and foolish

 

[RU_Planning]

Would also have been hard to see how United/Continental could have been approved given the complete domination of Newark (and some other airports), but it happened, and now airfares out of Newark are prohibitively expensive.

As a result, I now fly out of LaGuardia and JFK (at great inconvenience), whereas I never had to do this before that merger

Regulators are unpredictable and foolish

How is a service provider acquiring a content provider anything like an airline acquiring an airline?

 

[rutgersguy1]

Would also have been hard to see how United/Continental could have been approved given the complete domination of Newark (and some other airports), but it happened, and now airfares out of Newark are prohibitively expensive.

As a result, I now fly out of LaGuardia and JFK (at great inconvenience), whereas I never had to do this before that merger

Regulators are unpredictable and foolish

The post you quoted is inaccurate. Time Warner Cable and Time Warner aren't the same company anymore, They were at one time in the past. It's referred to above a couple times. There's no overlap in this merger. This is content (Time Warner's HBO, Turner properties, Warner Bros, etc..not Time Warner Cable) merging with ATT which is distribution (DirectTV/Uverse and wireless which eventually could be capable to bring high speed wireless into people's homes).

So the question is bringing a big player in content and a big player in distribution under one roof too much? I don't know but you do have precedent as I mentioned with Comcast buying NBC Universal and the fact that Time Warner Cable was under the roof of Time Warner at one time and was never forced to be broken up. My guess would lean a little towards approval but regulators are unpredictable and you have possible Democratic leanings coming into gov't so who knows.

Really if and likely when high speed wireless is developed you'll have more competition on the distribution side. Then suddenly you have Verizon, ATT (beyond Fios, DirectTV/Uverse) and likely TMobile, Sprint able to bring high speed broadband into people's homes wirelessly. They say that technology could develop in 5-7 years. I don't know but I do think it happens eventually. Masason, the Softbank CEO (a company that owns the majority of Sprint) from Japan had that vision of high speed wireless into homes in his failed attempt to merge Sprint with TMobile a few years ago saying he needed that scale to bring that high speed wireless to the US. So eventually I think it's possible to have more competitors in distribution somewhere down the line.

The news I liked this morning that I heard on CNBC was that ATT was going to be rolling out a DirectTV Now service/app untethered from their satellite service. I think it's about 100 channels which could include some of their premium properties they just acquired. A lot of people have been slimming down packages and cord cutting and this in that vein. That's never been my bane though, it's been the set top boxes I've had to add since the move to digital. To me with an app like this and the tv channel apps available on the newest generation Apple TV (that has storage) I'm starting to see steps in the direction where we may not need these extra set top boxes in the future or maybe none at all. I'll be happy if and when that day comes, the bundling was never an issue for me like it may be for others.

 

[nick614]

Tell him to calm down. The bookies in London are already paying off to those that bet on Hillary to be our next President.

They also only gave Brexit a 25% chance of winning on the day of the referendum

 

[Kbee3]

They also only gave Brexit a 25% chance of winning on the day of the referendum

Did they pay off to the bettors that put money down one way or the other PRIOR to the actual results coming in ? That's what's happened in England for bets on our Presidential election.
And you know they're right too. Be honest.
Trump is a loser.

 

[nick614]

Did they pay off to the bettors that put money down one way or the other PRIOR to the actual results coming in ? That's what's happened in England for bets on our Presidential election.
And you know they're right too. Be honest.
Trump is a loser.

Maybe, we'll see soon