This article written by Leslie Picker and Cecilia Kang primarily focuses on the issue regarding the merger of cellular phone giant AT&T with the entertainment conglomerate Time Warner. In late October the New York Times broke the news of these two joining and many industry annalists viewed the merger with skepticism as well as, outraged consumer groups. Individuals believed that AT&T and Time Warner would terminate any competition and create unfair pricing in order to encourage more mass media consolidation resulting in a market that would be strikingly similar to a pure monopoly. Picker and Kang compared and contrasted the merger of AT&T and Time Warner to the merger of Comcast’s acquisition of NBC Universal back in 2009. That acquisition
In the world today, when you hear the words AT&T, Cox Cable, DirectTV and Comcast the first thing that would typically come to mind is enjoying sports and family television. Often time’s customers don’t really know into the weeds of a company until something goes wrong. A consumer may find interest in the event they have bought stocks into a company and they see it all fall. Companies such as this service millions and millions of people all over the world. It is sad to know that some of these organizations while looking squared away on the inside have such serious ethical issues going on or that went on within their organization. The last thing a customer wants to do is tune into the t.v. and find out that one of their providers was
If they are able to maintain the loyalty of most of their current customers, the companies will then have a shared amount of about 100 million customers. This potential customer volume for the merging companies would greatly outnumber the customer volume of the industry leaders, AT&T and Verizon. This kind of turnout would create greater competition between the two merging companies and the two leading companies (Sprint Wireless News, 2014). Although the outcomes seem promising for Sprint and T-Mobile, there are also potential negative effects of a merger that the companies should take into consideration. Current Sprint and T-Mobile customers have expressed their fear of the possible merger for multiple reasons. The two biggest worries for telecommunication services consumers is the potential for rising costs and a reduction in provider options (John, 2016). In making a final decision, the companies, as well as the Federal Communications Commission, should weigh the advantages and disadvantages of a
Verizon’s business is most heavily influenced by the advancements in technology, but other industry changes and government decision making are other social issues changing Verizon. As previously discussed in the essay, Net Neutrality is a bill that projects the future of the telecommunications industry. In the case that it is protected it will prevent a monopoly of the internet which will benefit more than just consumers, but for Verizon the abolishment of the bill will mean opportunity to increase profits through selling the internet since it will no longer be a free utility (Maisto, 2014). Thus, the industries future profits lye on the decision of Net Neutrality.
This article is about the threat of merger and the influence of a monopolistic media. The
AT&T recently acquired DirecTV after the latter’s shareholders voted to endorse the acquisition or merger. The acquisition was first endorsed by the boards of these companies in May 2014 before being subjected to a review by anti-trust regulators in the Department of Justice and Federal Communications Commission (England-Nelson, 2014). The approval of the acquisition would result in the merger of the country’s largest wireless carrier with the biggest satellite TV provider in the country. The merger between these two firms is geared towards creation of a leading content provider across various platforms i.e. video, mobile, and broadband services. However, the acquisition was influenced by various factors and is associated with several significant effects in light of the organizational structure.
Berners-Lee questions whether America “[wants] a web where cable companies determine winners and losers online?” and cable companies are able to “decide which opinions we read”. To an extreme level, cable companies would be able to determine “which creative ideas succeed” (Berners-Lee 2). This opposes the freedom that American citizens strive for. It puts a limits the equal opportunity that so Americans find so important. Furthermore, “the change would allow internet-service providers to throttle some online traffic and allow companies to pay extra for faster delivery of their content” (Martinez & Hoisington). Without net neutrality, internet-service providers would be able to smother small or upcoming businesses by limiting their audience. However, the impact of the repeal of net neutrality does not stop here. The repeal of net neutrality “also eliminates several other consumer protections, such as a requirement that ISPs be more transparent with customers about hidden fees and the consequences of exceeding data caps” (Brodkin 1). Repealing net neutrality would deregulate internet-service providers, allowing them to have far too much control over their
Verizon Wireless is the result of “one of the largest mergers in U.S. business history” between Bell Atlantic Corp. and GTE Corp. on June 30, 2000” (History and Timeline. Verizon 2017). Even though “Verizon was ranked #1 in three out of four regions for residential internet service, #1 in six out of six regions surveyed for wireless, and #1 overall among U.S. large-business customers” in 2016, there was unrest in the organization (Building a Connected World 2016).
Than to switch to different providers every time I move location. Comcast also provides extra perks to their costumers, such as free wi-fi hotspots and Television bundles; services that smaller companies are unable to bundle. Particularly, as an article by Variety magazine points out, the DOJ was especially worried that if Comcast had Merged with TWC it would have both the means and the motives to inhibit competition from video rivals such as Netflix, give the market share Comcast would have (Spangler). This could even be categorized as the abuse of dominant
In last 10 years there has been a major emergence of a company called XM / Sirius Satellite radio. When fellow competitors XM Radio and Sirius Satellite Radio announced plans for a merger in 2007, most thought that an answer from the FCC would be coming the usual window of six months, allowing for a smooth transition of these two companies. Ignoring a self-imposed rule to handle such cases in 6 months of less, FCC Chairman Kevin Martin chairman withheld the verdict for approximately 17 months as his FCC debated the antitrust issues between Sirius and XM. Briefs were submitted by the Justice Department, individual citizens, and traditional radio broadcasters, arguing that the XM-Sirius merger should have been prevented over antitrust concerns. Ultimately, the Justice Department, and then the FCC, on a 3-2 vote, approved the merger in 2008. This paper seeks to discuss merger and antitrust positions concerning Sirius XM by starting with a history of each individual company, explaining the relevant business law topics and opponents’/proponents’ arguments, and highlighting the post-merger financial success of the combined company.
Although the presence of competition between the various media providers is good, America’s media industry is faced with a major concern of oligopoly. There are special interest groups that have a grip on the country’s media companies such as major television channels and broadcasting. Statistics show that a large part of what Americans view, hear, or read is controlled by a few corporations that own major television and radio stations, as well as newspapers (Bennett, 2004). For instance, there are six big corporations that dominate the American media industry. First, News Corp, which is owned by Rupert Murdoch, an Australian-born media tycoon, owns the wall Street Journal, DirecTV, and Fox Television, among others (London, 2015). Second, General electric owns Universal Vivendi and the National Broadcasting Corporation (London, 2015). Third, the Cable News Network is owned by Time
Most everyone subscribes to some type of cable service. When Comcast announced plans to merge with Time Warner Cable back in February, Congress was quick to criticize the deal (Popelka). Many members of Congress were not in favor of the merger, and rumors of an antitrust review were imminent (Popelka). "This is a great example of how U.S. antitrust policy has turned into a political game"( Popelka). Politicians may gain supporters, but no one is going to decrease the cost of cable service to consumers (Popelka). Antitrust laws were put into place for a reason. "The Sherman Antitrust Act was created to prevent monopolistic activities that diminish consumer choice or competition" (Popelka). In this case, the merger between these two companies will not take away consumer choice because they operate in different geographies (Popelka). Cable companies are struggling to keep up with the demands of younger consumers who are interested in online services instead of cable (Popelka). Politicians who oppose this merger are using the "Herfindahl-Hirschman Index (HHI) to evaluate monopoly status" (Popelka). Comcast has found a way around this so they can stay "below a mythical 30 percent HHI market share threshold" (Popelka).
Skeptics of net neutrality can often contend with those who support net neutrality by drawing comparisons with the Cable Act of 1992. The act was meant to protect the consumers by forcing cable companies to carry most local broadcast channels and prohibited them from charging local broadcasters to carry their own signal. One such argument came from Thomas W. Hazlett, a professor of law and economics at George Mason University; he stated that the act’s inability to maintain the number of customers, let alone increase raises the question of the real effects of “consumer protection” laws despite its initial intentions. Hazlett likens net neutrality by insisting that it’s likely to repeat the same consequences, which stifle progress and profit.
Yet another great post to ride out the journey with kudos! Good find with the Amtrak train company, I would never have thought of that. I agree with your definitions whole heartedly, I also think of your example of conglomerates as deontology. I know where you are coming from with Time Warner, they did that here and other companies forced them to bankrupt. Although, I gave up our dish network because they wanted $180.00 for 150 channels and half of them were either news media or channels that ran reruns so we save that money for other important things and the grandchildren watch movies when they come over. Although, Time Warner sound like they are money hungry, in fact they are, all companies out there are unethical. I find
The General Electric (GE) and Honeywell International (HI) case illustrates the complexities of structuring mergers and acquisitions when the combined firms are capable of exerting market influence that threatens the competitive landscape. While General Electric's CEO, Jack Welch, characterized the deal as, "This is the cleanest deal you'll ever see," European anti-trust regulators were not so inclined to view the transaction as harmless to competition (Elliot, 2001).
AT&T was broken up into the Bell companies in “1974 by the U.S. Department of Justice antitrust suit against the monopoly” (From Wikipedia, the free encyclopedia). Today AT&T has become a competitor vying for control of the telecommunications industry. “In monopolistic competition, there are many firms vying for control of one market. Each firm offers a different type of product, as opposed to perfect competition in which all offer the same product. Each firm, then, has a monopoly in the market of their own product”(Oracle ThinkQuest Education Foundation) AT&T in 1988 began purchasing stock in Sun Microsystems to begin its diversity in product services. Throughout the 90s AT&T continued purchasing more computer companies and cell phone companies to gain market share in the growing telecommunication industry (CyberStreet). Good pricing structures align with costs. AT&T Wireless realized that the marginal cost of a cellular minute was small compared to the cost of acquiring and maintaining customers. Their switch to a flat fee “One-Rate” plan was a huge success, stealing heavy users away from the competition. Prices increased for light users and many became hooked on the cellular lifestyle (Lake Partners Strategy Consultants, Inc. [LPSCI], 2001-2004). AT&T has seen that the ability to change quickly in the ever-evolving telecommunications market will help in gain market share. Its ability to see the value in keeping customers rather