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DOJ undecided on AT&T-Time Warner deal

The US Department of Justice is just as likely to block the acquisition as it is to approve it, according to a report from The Wall Street Journal.

Laura Hautala Former Senior Writer
Laura wrote about e-commerce and Amazon, and she occasionally covered cool science topics. Previously, she broke down cybersecurity and privacy issues for CNET readers. Laura is based in Tacoma, Washington, and was into sourdough before the pandemic.
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Laura Hautala
2 min read
AT&T's purchase of Time Warner Cable could be in doubt if the DOJ follows through on suing to block the deal.

AT&T's purchase of Time Warner Cable could be in doubt if the DOJ follows through on suing to block the deal.

Roberto Machado Noa/Getty Images

Will it be an amicable deal -- or a federal case? That's the question hanging over a megadeal between AT&T and Time Warner Cable valued at $85 billion as of last year.

According to The Wall Street Journal, the US Department of Justice is looking into how it would build a case against the acquisition in federal court, if it comes to that. Sources told the Journal that the regulatory agency is just as likely to reach a settlement with the companies that would let the deal go forward without running afoul of antitrust law.

At the heart of the Justice Department's quandary is whether AT&T, the second-biggest wireless carrier in the US, will create a monopoly by buying Time Warner, the second-biggest cable company in the US. Combining the companies would place two huge consumer markets under one banner, making it so more consumers would pay all their bills for internet access and cable television to the same company.

Market analysts predicted smooth sailing for the deal, and the possibility of a lawsuit makes things more uncertain, according to the Journal.

"When the DOJ reviews any transaction, it is common and expected for both sides to prepare for all possible scenarios," AT&T said in a statement, noting that "vertical" mergers are always approved because they don't eliminate competitors from the marketplace. "While we won't comment on our discussions with DOJ, we see no reason in the law or the facts why this transaction should be an exception."

Time Warner didn't immediately respond to a request for comment.

First published at 2:44 p.m. PT.
Update, 3:16 p.m.: Adds comment from AT&T.