President Trump’s unprecedented attacks on the media are a threat to free speech, but they also make it difficult for the Justice Department to maintain any credibility when it comes to regulating media companies.
On Wednesday, The New York Times reported that the Justice Department has “called on AT&T and Time Warner to sell Turner Broadcasting, the group of cable channels that includes CNN, as a potential requirement for approving the companies’ pending $85.4 billion deal.”
The Times’ report about DOJ’s desire to sever CNN from a potential AT&T/Time Warner merger was corroborated by the Financial Times, which reported that “AT&T has been told by the US Department of Justice that it needs to sell CNN, Time Warner’s cable news channel, to get its $84.5bn acquisition of the media company approved.”
Both outlets reported that executives were baffled by the DOJ’s request, since there isn’t typically a legal basis to block “vertical mergers,” or mergers involving companies that don’t directly compete against each other.
President Trump has relentlessly attacked CNN in the past. During a news conference held just days before he took office, Trump refused to take a question from a CNN reporter, and smeared the network as “terrible” and “fake news.” During his first news conference as president just over a month later, Trump once again referred to CNN as “very fake news.” At that time, Trump was particularly piqued about CNN’s reporting on his campaign’s ties with Russia.
This past summer, Trump infamously posted a tweet featuring a doctored video clip of him beating up a visage of CNN.
In August, he admonished a CNN reporter, saying, “I like real news, not fake news. You’re fake news.”
While he’s relentlessly attacked CNN, Trump has frequently lavished praise on its rival, Fox News, which not only provides him with fawning coverage, but also downplays his scandals and stories that reflect poorly upon him.
During the campaign, Trump denounced a potential AT&T/Time Warner merger on principled grounds. At an October 2016 rally in Pennsylvania, Trump vowed his administration wouldn’t approve the deal “because it’s too much concentration of power in the hands of too few.” But as has been the case with many of Trump’s campaign promises, his administration has walked back his position since the election.
As the Financial Times notes, Makan Delrahim, the new head of the Justice Department’s antitrust division, indicated he’s not opposed to the merger.
“The sheer size of it, and the fact that it’s media, I think will get a lot of attention…. However, I don’t see this as a major antitrust problem,” Delrahim told a Canadian TV station last year.
While the Times report notes that “[t]he other potential way the merger could win approval would be for AT&T to sell its DirecTV division,” the Trump administration has already signaled a willingness to handle the potential deal in a manner befitting of authoritarian countries like Russia or Venezuela.
In July, the Times reported that White House officials discussed using the merger as “a potential point of leverage over their adversary.”
“Trump’s Justice Department will decide whether to approve the merger, and while analysts say there is little to stop the deal from moving forward, the president’s animus toward CNN remains a wild card,” the Times reported.
Along those lines, a “source familiar with the discussions” told Politico that the only reason the DOJ would single out selling CNN as a precondition for approving the deal “would be to kowtow to the president because he doesn’t like the coverage.”
“It would send a chilling message to every news organization in the country,” the source added.
The Financial Times reported that “AT&T is opposed to selling the TV network and is preparing to take the Trump administration to court, arguing the deal with Time Warner does not pose any competition violations.” John Stephens, AT&T’s chief financial officer, acknowledged during an investor conference on Wednesday that “the closing of the deal is now uncertain.”