The Federal Communications Commission (FCC) announced Monday that two lawyers from the Department of Justice's antitrust division will be heading up the agency's inquiry into major proposed mergers in the telecommunications industry.
Hillary Burchuck will be leading the team, including deputy Bill Dever from the Wireline Competition bureau, reviewing the $45 billion deal to combine Comcast and Time Warner, the two largest cable providers in the United States. The team will also scrutinize related deals in which Charter Communications will receive 1.4 million Time Warner subscribers and 2.5 million Comcast users. This isn't Burchuck's first tangle with the telecomm industry. The lawyer was a major player in helping the 2011 Comcast-NBC Universal merger.
The FCC also announced that Comcast-Time Warner team's senior economist will be William Rogerson, the former chief economist at the FCC and a current Northwestern University professor.
Another former DOJ antitrust lawyer, Jamillia Ferris, will spearhead the team reviewing a nearly-$50 billion deal between AT&T and DirecTV. Deputy Elizabeth Andrion, a private lawyer with Hunton & Williams LLP. will aid Ferris throughout the proceedings.
AT&T is currently the No. 2 wireless carrier in the United States with 116 million subscribers, behind Verizon's 122 million. DirecTV, meanwhile, is the largest satellite TV provider in the United States, with 20 million customers. Combing that with AT&T's U-Verse TV service would make the new company television provider for nearly 26 million Americans.
"Horizontal competition won't be the only way they look at market dynamics and the competitive effects of the transaction," Ferris said in a May interview with Variety. "For example, you can expect that they will examine whether the combined company will have enhanced buying power that results in less or lower quality output when negotiating with content providers. DOJ may also analyze whether that power harms competition with other media companies trying to access content."
Both teams will report to a steering committee led by chair FCC General Counsel Jonathan Sallet. Other members of the steering committee include Media Bureau Chief Bill Lake, International Bureau Chief Mindel de la Torre, Wireline Competition Bureau Chief Julie Veach, and Wireless Telecommunications Bureau Chief Roger Sherman.
Approval from both the FCC and DOJ is needed for the deals to go through, and while no time frame for a final report has been announced, many experts believe that the unofficial 180-day, or 3 month, timeline will be followed. Most of the debate will center around the risks of consolidation, and whether they can be mitigated through the benefits of scale.
"We're concerned that there may be too much, too rapid consolidation in the telecommunications industry," Michigan Democrat John Conyers said at a Senate hearing late June concerning an AT&T-DirecTV merger. "This ongoing wave of consolidation will without question result in fewer firms and may harm consumers by limiting choices and also raising prices after all. ... I will be looking and listening to make sure that we are not moving in the wrong direction."
"This is not Comcast/Time Warner, this is not two cable companies getting together, this is not Sprint and T-Mobile," CEO Randall Stephenson told a House Judiciary Committee panel. "We're putting (DirecTV's satellite) TV product with our broadband wireless product. ... There is not a content player per se in this transaction."
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