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Up next: Comcast offer for Fox expected

Judge’s ruling clears way for others who want to consolidate

By MAE ANDERSON, Associated Press
Published: June 13, 2018, 6:05am
5 Photos
FILE - This March 29, 2017, file photo shows a sign outside the Comcast Center in Philadelphia. Disney has made a $52.4 billion all-stock offer for the bulk of Twenty-First Century Fox, including the studios behind the “Avatar” movies, “The Simpsons” and “Modern Family,” along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers. But Comcast has said it is preparing an all-cash offer that is superior to Disney’s.
FILE - This March 29, 2017, file photo shows a sign outside the Comcast Center in Philadelphia. Disney has made a $52.4 billion all-stock offer for the bulk of Twenty-First Century Fox, including the studios behind the “Avatar” movies, “The Simpsons” and “Modern Family,” along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers. But Comcast has said it is preparing an all-cash offer that is superior to Disney’s. (AP Photo/Matt Rourke, File) Photo Gallery

NEW YORK — Now that a federal judge has cleared AT&T’s $85 billion takeover of Time Warner, other companies are likely to rush to consolidate.

Tuesday’s ruling signaled that federal regulators might have a hard time stopping companies from getting bigger by gobbling up rivals and the content they own. Even if a company doesn’t need to get bigger right away, it might need to do so to prevent a competitor from doing so.

For starters, expect Comcast to make a bid for Fox’s entertainment business as early as Wednesday.

These mega deals — some in the works, some still to come — will transform the media landscape and change how people consume entertainment.

Here’s a look at some of the pending and possible combinations:

• FOX WITH DISNEY OR COMCAST

Disney has made a $52.4 billion all-stock offer for the bulk of Twenty-First Century Fox, including the studios behind the “Avatar” movies, “The Simpsons” and “Modern Family,” along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers.

But Comcast has said it is preparing an all-cash offer that is superior to Disney’s. It will likely to make an offer soon, now that the judge has ruled in AT&T’s favor, without setting any conditions.

David Turetsky, a professor at the State University of New York at Albany, warns that the AT&T ruling is based on “specific facts and evidence” that may or may not apply in other cases. Still, many of the circumstances in that case are similar with a potential Comcast bid.

If Comcast succeeds in outbidding Disney, a major cable distributor would control even more channels on its lineup and those of its rivals. That could lead to higher cable bills or make it more difficult for online alternatives to emerge, though there is not yet evidence of either happening following other mergers. For Disney, a successful Comcast bid could make Disney’s planned streaming service less attractive.

• SPRINT AND T-MOBILE

In April, the two telecom companies announced a $26.5 billion combination. The deal would combine the nation’s third- and fourth-largest wireless companies and bulk them up to a similar size to Verizon and AT&T, the industry giants.

The worry is that with just three major carriers, there would be less incentive to keep innovating on prices and service. T-Mobile and Sprint might even raise prices now that they don’t have to try to poach customers off each other.

A 2014 attempt to combine fell apart amid resistance from the Obama administration. But the industry is different just four years later. Wireless carriers aren’t just competing with each other, but also with Comcast and others as the wireless, broadband and video industries converge. AT&T is about to get larger with CNN, HBO and other channels from Time Warner. Beyond combining with each other, T-Mobile and Sprint might need its own content acquisition to compete.

• CBS AND VIACOM

CBS has resisted pressure from its controlling shareholder, National Amusements, to merge with Viacom, which also is controlled by National Amusements. The two companies used to be one but separated in 2005.

A combination would reunite CBS’s television business with Viacom’s production studios, similar to the arrangements now in place at NBC owner Comcast and ABC owner Disney.

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