In a rather drastic move, the U.S. Department of Justice filed a lawsuit against the anticipated merger between AT&T and Time Warner. The government claimed that the merger would result in a steep rise in consumer prices.
The merger between the two giants has been a point of debate for weeks. While the U.S. President Donald Trump has been set against the union, the companies themselves have shown determination to see the merger through.
In the past, the government has even stated that it would allow the merger to take place if the companies would give up some of their bigger assets, such as the Warner owned news network, CNN.
However, the companies have steadfastly refused to comply with the restrictions placed upon the merger. Taking matters into its own hands, the government has now decided that a legal ban would be the best way to stop the merger.
The government has gone forward with its lawsuit, claiming the merger would reduce competition in the industry and lead to higher consumer prices.
However, many believe that the objections have more to do with power than price. The merger would result in a super company, which could threaten the financial capacity of the government itself.
Commenting on the lawsuit AT&T’s CEO, Randall Stephenson expressed surprise. He stated that the acquisition seemed to have been on a good path “until recently”. He also made a passing reference to the “elephant in the room”, a clever way of referring to the Presidential influence behind the lawsuit.
Trump’s dislike for CNN was evident throughout his campaign and the companies believe he is now wielding his dislike as a weapon against the merger.
AT&T, however, has refused to give in to the government’s bidding without a fight. The company has vowed to fight the lawsuit, come what may.