Specifics: "The new company would also have the capacity and incentives to take various forms of discrimination against its competitors in both markets, which could weaken the competitive environment." the Brazilian antitrust authority, known as CADE, said in a statement Tuesday, according to a translation by the FT.
- CADE also said the proposed deal would allow Time Warner to gain access to sensitive information from all its competitors through Sky (one of Brazil's biggest operators, of which AT&T owns a 93% stake, according to Bloomberg).
- And AT&T would have access to conditions negotiated by its rivals through Time Warner (one of Brazil's largest pay-TV programmers), "significantly harming businesses and consumers in the pay-TV segment."
In the U.S. A coalition of public interest and consumer groups made a similar argument in a letter to the DOJ last month:
"As both a major programmer and a major distributor, it would be able to use information from both sides of the negotiating table to give itself better deals than its rivals can obtain—it would necessarily know, for instance, what its programming rivals are charging for their content, and what its distribution rivals are paying."
AT&T disagrees: AT&T says the deal benefits consumers by providing more content options and will no have anti-competitive impacts on the market. "AT&T and Time Warner will work with Cade to clarify any issues they may have to promptly reach a final resolution on the matter," the company said in a statement.
What's next: In Brazil, a decision is expected in November, although that deadline could slip up to 90 days. In the U.S., authorities are reportedly pretty far along in the review and are discussing conditions with the companies, according to WSJ, indicating that the deal is on the path to approval. Chile also must finalize its regulatory review. AT&T still expects the deal to close by the end of the year.
