NEW YORK – The U.S. appears to be following in Canada’s VI footsteps now that U.S. telecom giant AT&T has officially agreed to acquire Time Warner Inc. for $85.4 billion.
But a Fortune report says that the massive deal “seems like a desperation move by both, an admission that they don’t really know what else to do, except try to get larger and hope everything works out for the best”. Only Comcast in the States has tried something similar with NBCUniversal, although Verizon is also trying to get into more content with the planned purchase of Yahoo!.
“For one thing, vertical integration between distributors and content producers is no guarantee of success, and it’s not clear that even trampling all over the principle of net neutrality will make it work – although there’s no question AT&T will try”, reads the report.
“In fact, owning Time Warner content could actually make it harder for the content side of the combined business to prosper because potential partners may not want to sign deals with the telecom giant where they might have if Time Warner was a standalone company.”
In Canada, we have three large vertically integrated media and carriage companies (Bell, Quebecor and Rogers) and a fourth (Shaw) which just divested its media assets to Corus – but to a company controlled by the same family.
It's a Google, Facebook, Apple and Amazon world. It's hard to know as an old media company or big carrier how the future will fit.
