Communications Mergers

The lead article in today’s New York Times, “AT&T to Acquire DirecTV in Move to Expand Clout,” describes yet another telecommunications merger pending approval by federal regulators. The announcement comes upon the heels of a request by Comcast to take over Time Warner Cable. Both mergers represent acquisitions in the neighborhood of $40 billion.

While it is noted that a strengthened AT&T would provide some competition to Comcast, it is not clear whether these mergers will help the American consumer to begin with. The telecommunications industry seems to be badly in need of increased competition, and creating one giant company to counterbalance another does not seem to be a prudent strategy.

In the midst of all these acquisitions, Sprint is now making noises about taking over T-Mobile, a perennial source of merger attempts. Perhaps, T-Mobile is just too small to survive on its own in today’s telecommunications landscape.

The mergers also have implications for American democracy. At a time when it is all too easy to restrict access or shape the news according to billionaire owners’ desires, our country would be better off with a thriving and diverse telecommunications industry to prevent attempts at manipulation. I think federal regulators should say no to both mergers and even make attempts to reverse this trend completely.