FILE PHOTO: A combination photo of the Time Warner shares price at the New York Stock Exchange and AT&T logo in New York Thomson Reuters By Carl O'Donnell and Diane Bartz

(Reuters) - A federal judge on Tuesday gave a ringing endorsement to AT&T Inc's planned acquisition of Time Warner Inc without any conditions, opening the door for companies such as Comcast Corp and Verizon Communications Inc to pursue deals to buy creators of media content.

The ruling by Judge Richard Leon https://bit.ly/2Jxx6qE of the U.S. District Court for the District of Columbia brings an end to a six-week antitrust trial in which U.S. regulators argued that the $85 billion deal would give AT&T undue leverage against rival cable providers that relied on Time Warner's content.

The judge's strong approval, and scathing opinion that urged the government not to seek a stay if they opposed the ruling, will give telecommunications providers the confidence that similar types of acquisitions will also have a shot at clearing regulatory hurdles, and could spur other copycat mergers this year, industry analysts and dealmakers said.

Investors are now also expecting major media consolidation, with Twenty-First Century Fox Inc shares rising more than 6 percent in after-market trading. Cable network owner Discovery Inc saw shares increase 3.2 percent while mobile providers, Sprint Corp and T-Mobile US Inc, which are waiting for a government approval of their own, also saw a bump following the decision.

AT&T said that controlling Time Warner's cable brands will help it craft new types of content to retain its customers as web-based rivals like Netflix Inc woo audiences away from traditional pay-TV subscriptions.

For cable companies feeling the pain of cord-cutting, similar deals for coveted media brands could help them build out new content offerings and offset expected declines in revenues, analysts and dealmakers told Reuters.

The Justice Department had argued that AT&T's acquisition of Time Warner would allow it to charge premium prices to rivals who relied on its Turner and HBO channels to woo customers to their cable plans, potentially giving it an unfair advantage in the pay-TV market. Now this will be a less of a concern for companies.

"This decision could serve as a 'green light' for other potential M&A, including Comcast's ongoing pursuit of FOX," said John Hodulik, an analyst at UBS, in a note.

Regulators will still likely scrutinize similar deals, and there is no guarantee that the district court's approval of AT&T's merger with Time Warner means that other major media acquisitions would be approved, several antitrust attorneys told Reuters.

Still, at least one company, Comcast, the largest U.S. cable provider, had been waiting for the court decision before making any large M&A moves in media, sources have said.

Rival cable company Comcast is now likely to go ahead with its planned attempt to woo Fox away from Walt Disney Co, which said it would acquire most assets of the media company for around $50 billion last year.

"Regardless of what happens on the appeal front, expect Comcast to put forth an all-cash bid in the next day or so at a premium to Disney," said Mary Ann Halford, senior adviser to OC&C Strategy Consultants.

Comcast is aiming to gain control over Fox assets such as its Twentieth Century Fox Film and TV studios, which includes brands ranging from X-Men to The Simpsons, as well many of its cable networks.

The court ruling could also open the door for Verizon, AT&T'S main rival, to bid for a media company, UBS' Hodulik added.

However, in Verizon's most recent quarterly earnings call, executives said they would rather sit out the current consolidation, and instead build out its content offerings through partnerships with independent media companies.

It also appointed a new chief executive officer earlier this month, Hans Vestberg, the company's chief technology officer, in a move that signaled Verizon would likely double down on its existing telecommunications business.

Still, one potential target for Verizon would be a combined CBS Corp and Viacom Inc, analysts have said, assuming that on ongoing legal battle between CBS's controlling shareholder, Shari Redstone, and the company's board, is resolved.

In a recent court filing, Redstone said her long-term plan was to create a combined company, which would unite media assets including CBS' broadcast networks, Showtime, MTV, Comedy Central and Nickelodeon, and then sell it.

Halford, from OC&C added, "All I know is that this will be a blockbuster summer for media mergers!"</s>WASHINGTON — A federal judge approved the $85 billion mega-merger of AT&T and Time Warner on Tuesday, potentially ushering in a wave of media consolidation while shaping how much consumers pay for streaming TV and movies.

U.S. District Judge Richard Leon green-lit the merger without imposing major conditions as some experts had expected. The Trump Justice Department had sued to block the $85 billion merger, arguing that it would hurt competition in cable and satellite TV and jack up costs to consumers for streaming TV and movies.

Now, the phone and pay-TV giant AT&T will be allowed to absorb the owner of CNN, HBO, the Warner Bros. movie studio, “Game of Thrones,” coveted sports programming and other “must-see” shows. The Justice Department could appeal the ruling, although it said only that it is considering its options.

The ruling could open the floodgates to deal making in the fast-changing worlds of entertainment production and distribution. Major cable, satellite and phone companies are bulking up with purchases of entertainment conglomerates to compete against rivals born on the internet such as Amazon and Google.

Waiting in the wings are potential big-billions deals involving 21st Century Fox and Disney, Verizon and CBS, T-Mobile and Sprint. Comcast and Verizon are also jockeying for position in the new landscape.

A combined AT&T-Time Warner could also get a boost from Monday’s official end of net neutrality —the Obama-era rules that barred broadband and wireless companies from favoring their own services to the detriment of rivals like Netflix. AT&T and Verizon now can give priority on their networks to their own movies and TV shows, while hurting rivals such as Amazon, YouTube and future startups.

“The impact from this decision will have wide reaching ramifications across the telecommunications, media, and tech industry for decades to come,” said GBH Insights analyst Dan Ives.

The merger would combine a company that produces news and entertainment with one that funnels that programming to consumers. AT&T cast it as a necessary step at a time when people spend more time watching video on phones and tablets and less time on traditional live TV on a big screen.

Leon said the government failed to prove that the merger would lead to higher prices and other harm to consumers. Despite Justice Department lawyers taking their “best shot,” he said, their evidence was “too thin a reed for this court to rely on.”

Leon added that he wouldn’t temporarily block the merger for a possible appeal by the government. The “drop dead” deadline for completing the merger is June 21. If it’s not wrapped up by then, either company could walk away, and AT&T would have to pay a $500 million breakup fee.

The ruling was a stinging defeat for the Justice Department. Opposing the merger forced federal antitrust lawyers to argue against standing legal doctrine that favors mergers among companies that don’t compete directly with each other.

Another wild card: When first announced in October 2016 , the deal drew fire from then-candidate Donald Trump, who promised to kill it “because it’s too much concentration of power in the hands of too few.” Trump has also publicly feuded with Time Warner’s CNN, calling it “failing” and a purveyor of “fake news.” The president’s statements didn’t come up during the trial.

John Bergmayer, senior counsel at the consumer group Public Knowledge, said the decision could have long-lasting negative effects thanks to “the many other mergers it will encourage.” In a statement, Bergmayer called for “reinvigorated regulatory oversight of the video marketplace.”

Dallas-based AT&T is a wireless, broadband and satellite behemoth that became the country’s biggest pay-TV provider with its purchase of DirecTV. It claims about 25 million of the 90 million or so U.S. households that are pay-TV customers.

AT&T general counsel David McAtee said the company plans to close the deal on or before June 20.

Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.</s>A federal judge ruled in favor of AT&T’s $85 billion acquisition of Time Warner on Tuesday in a decision that is likely to raise the curtain on mega-mergers among the nation's entertainment companies.

U.S. District Judge Richard Leon did not impose any conditions that would have prompted AT&T to scuttle the deal, further emboldening legacy Hollywood and telecommunications companies to pair up in an effort to fight deep-pocketed tech rivals such as Netflix, Amazon, Apple and Google.

Even before the decision, Comcast said it was prepared to bid for 21st Century Fox's assets, signaling a price war with Disney, which agreed to pay $52 billion for the studios that would help Disney offer alternatives to Netflix.

Tuesday’s ruling is a pivotal chapter in a 20-month saga that began in Oct. 2016 when the largest U.S. telecommunications company first reached an agreement to buy Time Warner in a grab for TV and film content that would diversify its mammoth but mature Internet access business.

Time Warner is a hangout for DC Comics' superheroes Batman, Superman and Wonder Woman, as well as CNN and HBO, the premium network where Game of Thrones resides, and TNT, which just aired some of the NBA playoffs. AT&T owns pay-TV provider DirecTV alongside its extensive landline, wireless and Internet access businesses.

AT&T argued that a bigger company would benefit consumers because it would allow it to offer more new services, like a cheaper streaming service. General counsel David McAtee said the company looked forward to closing the deal next week "so we can begin to give consumers video entertainment that is more affordable, mobile, and innovative."

It's likely to use its new channels as a lure for subscribers.

"Expect aggressive bundling of HBO, CNN, and other proprietary sports content (NBA, NCAA, MLB) from Time Warner into the AT&T network as a key incentive for current and new AT&T wireless customers," wrote Daniel Ives, head of technology research at GBH Insights, in a note to investors.

The U.S. government sued to block the transaction this past November, arguing the larger company would have too much power and that individuals' TV tab would rise as a result. That was the position of Donald Trump when he was still a presidential candidate, and AT&T lobbied the court for communications between Trump's White House and the Justice Department to prove the suit was politically motivated.

The judge denied the legal move, and in the end, it didn't matter. After a six-week trial, Leon — who also presided over the Comcast-NBC-U mega-deal in 2011 — ruled from a packed courtroom that the government's case lacked merit.

Judge Leon also strongly urged the government not to appeal the decision, nor was he in favor of issuing a "stay" that could prevent the consummation of the merger by the break-up date of June 21, causing AT&T to have to pay Time Warner a $500 million breakup fee.

"I do not believe that the Government has a likelihood of success on the merits of an appeal," Leon wrote.

Justice Department assistant attorney general Makan Delrahim said the agency plans to review the opinion and "consider next steps in light of our commitment to preserving competition for the benefit of American consumers."

Some consumer groups, lawmakers and a trade group that represents smaller cable operators criticized the outcome as bad for individuals and competition.

"History has shown us that when these telecom companies get bigger, they don’t get better," said Jonathan Schwantes, senior policy counsel for Consumers Union.

The case was the most important U.S. antitrust case since the Department of Justice's attempt to block Microsoft from using its Windows operating system to monopolize software such as Web browsers on computers. The court's green light is expected to let loose a stampede of M&A activity in the media and entertainment space, starting with a titanic battle between Disney and Comcast for Fox assets.

Comcast stock declined nearly 4.6% in after-hours. Disney shares dropped nearly 1.5%. Fox shares rose 1%.

T-Mobile and Sprint are pursuing their own $26 billion merger that would create a larger No. 3 cell-phone carrier. Last year, Verizon bought Yahoo for $4.5 billion, a bid to build a digital advertising competitor to Facebook and Google. The entire telecom industry is dealing with cooling revenues from traditional sources such as subscribers.

Recon Analytics analyst Roger Entner envisions Silicon Valley stalwarts like Google, Apple, and Facebook “that are currently putting a toe into (such activity), putting their whole foot into it.”

Having been rebuffed on AT&T-Time Warner, it isn't immediate obvious where the Trump Administration might come down on future mergers. It was unusual for the Justice Department to try to stop a merger between companies that didn't directly compete with each other.

“They’re going to bring cases, but they’re going to look at each case on its merits," expects Henry Su, a partner at Constantine Cannon is Washington, D.C.

Suspense about the outcome has been building since the trial ended April 30. A new twist emerged in early May with the revelation that AT&T paid President Trump's personal lawyer Michael Cohen $600,000 for consulting services at the time the company was seeking regulatory approval for the merger.

Even with the merger moving forward, AT&T may temper any rise in TV prices, at least for now. “The parties may do whatever they can to forebear from engaging in any allegedly anti-competitive behavior just so that the court of public opinion will be able to say, `oh yeah, it’s fine,’” Su says.</s>(AP Photo/Jose Luis Magana, File). FILE- In this March 22, 2018, file photo, AT&T CEO Randall Stephenson leaves the federal courthouse in Washington. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner...

(AP Photo/Jose Luis Magana, File). FILE- In this March 22, 2018, file photo, AT&T CEO Randall Stephenson leaves the federal courthouse in Washington. The judge presiding over the government's legal effort to block AT&T's purchase of Time Warner...

(AP Photo/Richard Drew, File). This Aug. 1, 2017, file photo shows the 21st Century Fox sign outside of the News Corporation headquarters building in New York.

(AP Photo/Richard Drew, File). In this Aug. 8, 2017, file photo, The Walt Disney Co. logo appears on a screen above the floor of the New York Stock Exchange.

(AP Photo/Mary Altaffer, File). This May 10, 2017, file photo, shows the CBS logo at their broadcast center in New York.

(AP Photo/Bebeto Matthews, File). In this Tuesday, May 2, 2017, file photo, Verizon corporate signage is captured on a store in Manhattan's Midtown area, in New York.

NEW YORK (AP) - Comcast will likely bid for Fox's entertainment business as early as Wednesday now that a federal judge has cleared AT&T's $85 billion takeover of Time Warner.

If Comcast succeeds in outbidding Disney for Fox, a major cable distributor would control even more channels on its lineup and those of its rivals. There are fears that it could lead to higher cable bills or hinder online alternatives.

But U.S. District Judge Richard Leon cleared the AT&T deal Tuesday despite similar concerns. The ruling signaled that federal regulators might have a hard time stopping companies from getting bigger by gobbling up rivals and the content they own.

Comcast isn't likely the only mega-media bid in the works. There will probably be a rush to consolidate.

Cowen analyst Gregory Williams said the ruling could unleash "pent up" demand for mergers and acquisitions "across the Pay-TV landscape."

Even if a company doesn't need to get bigger right away, it might need to do so to prevent a competitor from doing so.

Here's a look at some of the combinations that will transform the media landscape and change how people consume entertainment.

Disney has made a $52.4 billion all-stock offer for the bulk of Twenty-First Century Fox, including the studios behind the "Avatar" movies, "The Simpsons" and "Modern Family," along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers.

But Comcast has said it is preparing an all-cash offer that is superior to Disney's. It will likely to make an offer soon, now that the judge has ruled in AT&T's favor, without setting any conditions.

David Turetsky, a professor at the State University of New York at Albany, warns that the AT&T ruling is based on "specific facts and evidence" that may or may not apply in other cases. Still, many of the circumstances in that case are similar with a potential Comcast bid.

For Disney, a successful Comcast bid could make Disney's planned streaming service less attractive.

Wall Street braced for a bidding war. Shares in Fox increased nearly 8 percent to an all-time high of $43.90. Disney gained more than 2 percent, while Comcast lost more than 1 percent in morning trading Wednesday.

In April, the two telecom companies announced a $26.5 billion combination. The deal would combine the nation's third- and fourth-largest wireless companies and bulk them up to a similar size to Verizon and AT&T, the industry giants.

The worry is that with just three major carriers, there would be less incentive to keep innovating on prices and service. T-Mobile and Sprint might even raise prices now that they don't have to try to poach customers off each other.

A 2014 attempt to combine fell apart amid resistance from the Obama administration. But the industry is different just four years later. Wireless carriers aren't just competing with each other, but also with Comcast and others as the wireless, broadband and video industries converge. AT&T is about to get larger with CNN, HBO and other channels from Time Warner. Beyond combining with each other, T-Mobile and Sprint might need its own content acquisition to compete.

CBS has resisted pressure from its controlling shareholder, National Amusements, to merge with Viacom, which also is controlled by National Amusements. The two companies used to be one but separated in 2005.

A combination would reunite CBS's television business with Viacom's production studios, similar to the arrangements now in place at NBC owner Comcast and ABC owner Disney. (On the flip side, the Fox television network and studios would separate under a deal with either Comcast or Disney.)

With Viacom, the $6-a-month CBS All Access streaming service might have a larger library, as Viacom owns MTV, Nickelodeon, Comedy Central and other cable networks.

Verizon, which bought AOL and Yahoo in recent years, could be on the prowl for other entertainment properties. Verizon wants to challenge Google and Facebook in the huge and lucrative field of digital advertising - and having more content could help. There's speculation that CBS could be a potential target. With its main wireless rival AT&T becoming even more of a content powerhouse, Verizon might feel the need to grow.

Cowen's Williams suggests, however, that rather than buy an entertainment or media company, Verizon might buy a company that bolsters its network or infrastructure. Cable company Charter or satellite TV company Dish are "ideal candidates," he wrote in a research note.

Rumors have long swirled that Lionsgate might be a potential takeover target by anyone from Amazon to Verizon or even a combined CBS-Viacom entity. Nothing has materialized yet for the owner of the "Twilight" and "Hunger Games" franchises. As a smaller studio, Lionsgate needs to get bigger to compete in the current landscape.

Similarly, Viacom-owned Paramount studio has been on the chopping block before. After years of troubles, it has recently rebounded with the horror film "A Quiet Place" and comedy "Book Club." That could make it a lucrative takeover target by a company seeking content creators.

Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.</s>US District Judge Richard Leon said the government had failed to meet its burden of proof that the tie-up between the largest US pay-TV operator and the media entertainment giant would harm competition.

The case had been closely watched as setting a benchmark for other big corporate mergers, especially in the media and communications sector.

Leon said the case fell short on all counts and warned the government against seeking to hold up the deal with an appeal, saying that would cause "irreparable" harm to the two companies whose tie-up has been delayed for a year and a half.

"There would be no irreparable harm to the government (with a delay), only to the companies," Leon told the packed courtroom in an unusual session to announce his opinion.

"The government has taken its best shot and lost."

Leon's 172-page ruling was a total victory for the companies. It said the government failed to back up its three theories of harm to consumers from the mega-merger.

He maintained that the government's claim that pay TV costs would rise from the tie-up was based on "speculative" logic and that its study from an expert witness was contradicted by other evidence from the government.

Daniel Petrocelli, who led the legal team for the two companies, told reporters outside the courthouse that the decision marked a "sound and proper" repudiation of the government's case.

"We're disappointed that it has taken 18 months to get here but we're relieved that it's finally behind us," he said.

He said the ruling "stands as a testament to the wisdom of the combination of these two great companies and how it will benefit consumers for generations to come."

AT&T general counsel David McAtee said in a statement he was pleased with the outcome and expected the deal would be closed by June 20.

The deal brings together AT&T's wireless and broadband networks and its DirecTV subscription service with the media assets of Time Warner, which include CNN and other Turner cable channels, Cartoon Network, premium channel HBO and the Warner Bros studios.

Makan Delrahim, head of the Justice Department's Antitrust Division, said the government was considering its next steps.

"We are disappointed with the court's decision today," he said.

"We continue to believe that the pay-TV market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner."

John Bergmayer of the consumer group Public Knowledge said he expected the government would appeal.

"In the meantime, not only may consumers be harmed directly by the anticompetitive harms that this merger will cause, such as higher bills and fewer choices of programming and provider, but also by the many other mergers it will encourage," Bergmayer said.

Some analysts say the court approval offers an effective green light to other major deals, including the Walt Disney offer to buy key film and television assets of 21st Century Fox and the T-Mobile/Sprint agreement in wireless.

"Due to AT&T already owning Direct TV and having U-verse, it has been using a lot of Time Warner content for some time. Thus, I don't think the integration will be as difficult as it first appears," said Morningstar analyst Allan Nichols.

But Rebecca Lieb of Kaleido Insights warned that mergers like these are usually "very difficult" to implement.

"Merging content distribution with creation is easier said than done, particularly on a scale that encompasses all media," she added.

AT&T and Time Warner argue they need more scale to compete with online rivals like Netflix and Amazon and with Silicon Valley giants like Google, Facebook and Apple, which are expanding in the rapidly evolving sector.

Independent media analyst Alan Wolk said the clear approval opens the door to AT&T offering new kinds of services and packages that can tie into 5G, or fifth-generation wireless networks.

"Imagine AT&T giving free CNN and free HBO to every AT&T wireless subscriber," Wolk said.

Time Warner gets better viewership data to more effectively compete against online platforms like Netflix, which "will make it easier for them to better target ads," Wolk added.

President Donald Trump had previously denounced the AT&T deal, vowing that his administration would block it because it would concentrate corporate power unacceptably.

This fueled speculation that Trump could be retaliating due to critical coverage of his administration from news broadcaster CNN, a Time Warner property.

"Trump's meddling in law enforcement actions, his attacks upon particular companies, and his utter unpredictability have created the kind of legal uncertainty common in 'banana republics,'" said Berin Szoka of the think tank Tech Freedom.

"At least in antitrust law, the courts, not Trump officials, will have the final say on what the law really is. Every business in America is safer today from being strong-armed by a would-be strongman."

Explore further: Fate of massive AT&T-Time Warner merger in US judge's hands</s>AT&T won court approval on Tuesday to buy Time Warner for $85 billion (roughly Rs. 5.75 lakh crores), rebuffing an attempt by US President Donald Trump's administration to block the deal and likely setting off a wave of corporate mergers.

The deal, which could close next week, is seen as a turning point for a media industry that has been upended by companies like Netflix and Alphabet's Google which produce content and sell it online directly to consumers, without requiring a pricey cable subscription. Cable, satellite and wireless carriers all see buying content companies as a way to add revenue.

Trump, a frequent detractor of Time Warner's CNN and its coverage, denounced the deal when it was announced in October 2016. US District Judge Richard Leon found little to support the government's arguments that the deal would harm consumers, calling one position "gossamer thin" and another "poppycock."

The ruling could also prompt a cascade of pay TV companies buying television and movie makers, with Comcast's bid for some Twenty-First Century Fox assets potentially the first out of the gate.

The merger, including debt, would be the fourth largest deal ever attempted in the global telecom, media and entertainment space, according to Thomson Reuters data. It would also be the 12th largest deal in any sector, the data showed.

In a scathing opinion, Leon concluded that the government had failed to show competitive harm and urged the US government not to seek a stay of his ruling pending a potential appeal, saying it would be "manifestly unjust" to do so and not likely to succeed.

"That's a legal shocker," said J.B. Heaton, an attorney and consultant on litigation and regulatory proceedings. "I think we'll see now that companies will be much more confident about vertical mergers," he added, referring to deals where a company merges with a supplier.

Shares of AT&T fell about 1.3 percent in after-hours trade following the decision, while Time Warner rose more than 5 percent.

Twenty-First Century Fox jumped 7 percent in extended trade after the ruling on expectations that Comcast and Walt Disney Co could start a bidding war to acquire its media assets. Comcast and Walt Disney dropped 4.3 percent and 1.8 percent, respectively.

Shares of other media and telecom companies also rose, including T-Mobile US, Sprint, CBS, Dish Network, Discovery and Viacom.

"This will be a blockbuster summer for media mergers," said Mary Ann Halford, senior adviser to OC&C Strategy Consultants.

Shares of Express Scripts Holding Co, which is set to be bought by Cigna Corp for $52 billion (roughly Rs. 3.5 lakh crores), rose 4.8 percent, while shares of health insurer Aetna Inc, due to be acquired by CVS Health Corp for $69 billion (roughly Rs. 4.7 lakh crores), rose 3.6 percent.

Opponents of the AT&T decision also predicted more deals.

"Consumers should fear a cascade of unchecked mergers and acquisitions to further consolidate the telecom industry resulting in less choice, fewer competitors and higher prices," Senator Richard Blumenthal, a Democrat, said in a statement.

The Justice Department filed a lawsuit to stop the deal in November 2017, saying that AT&T's ownership of both DirecTV and Time Warner would give AT&T unfair leverage against rival cable providers that relied on Time Warner's content, such as CNN and HBO's Game of Thrones.

Leaving the courtroom, Makan Delrahim, head of the Justice department's antitrust division, said that he would read the judge's opinion before making a decision on an appeal.

The Justice Department is not likely to be put off by the loss, said Amy Ray of the law firm Cadwalader, Wickersham & Taft LLP, noting it had prevailed in stopping other mergers between rivals.

"Put me on the side of the fence of thinking that AAG (Makan) Delrahim is interested in challenging the next problematic vertical transaction," she said.

Cornell law professor George Hay added that the ruling found the government's evidence lacking, rather than a broader determination of how vertical mergers affected competition.

AT&T in a six-week trial argued that the purchase of Time Warner would allow it to gain information about viewers needed to target digital advertising, much like Facebook and Google already do.

AT&T can use the content from Time Warner to fill its streaming services DirecTV Now and soon-to-be-launched AT&T Watch, which are cheaper online video packages with fewer channels. That could give it a leg up over rival live streaming platforms that do not own content, media analysts have said.

AT&T applauded the court's decision and said it expected to close the merger before the June 21 contractual deadline.

The government estimated costs to industry rivals, such as Charter Communications, would increase by $580 million a year if AT&T owned Time Warner.

Before the trial started, AT&T lawyers said the Time Warner deal may have been singled out for government enforcement but the judge rejected their bid to force the disclosure of White House communications that might have shed light on the matter.

The deal cost AT&T's top lobbyist, Bob Quinn, his job in May after it became public that AT&T had paid Trump's personal lawyer Michael Cohen $600,000 (roughly Rs. 4 crores) for advice on winning approval.

Burns McKinney, a portfolio manager at Allianz Global Investors who owns AT&T, said he would not say the telecoms company had won a huge victory.

"It's more that they just didn't lose. You always wonder in these cases if there's a winner's curse, given the risk (AT&T) can't get the desired synergies and they're taking on a lot of debt with the merger," he said.</s>NEW YORK (AP) — Comcast will likely bid for Fox's entertainment business as early as Wednesday now that a federal judge has cleared AT&T's $85 billion takeover of Time Warner.

If Comcast succeeds in outbidding Disney for Fox, a major cable distributor would control even more channels on its lineup and those of its rivals. There are fears that it could lead to higher cable bills or hinder online alternatives.

But U.S. District Judge Richard Leon cleared the AT&T deal Tuesday despite similar concerns. The ruling signaled that federal regulators might have a hard time stopping companies from getting bigger by gobbling up rivals and the content they own.

Comcast isn't likely the only mega-media bid in the works. There will probably be a rush to consolidate. Even if a company doesn't need to get bigger right away, it might need to do so to prevent a competitor from doing so.

Here's a look at some of the combinations that will transform the media landscape and change how people consume entertainment.

Disney has made a $52.4 billion all-stock offer for the bulk of Twenty-First Century Fox, including the studios behind the "Avatar" movies, "The Simpsons" and "Modern Family," along with National Geographic. Marvel would get back the characters previously licensed to Fox, reuniting X-Men with the Avengers.

But Comcast has said it is preparing an all-cash offer that is superior to Disney's. It will likely to make an offer soon, now that the judge has ruled in AT&T's favor, without setting any conditions.

David Turetsky, a professor at the State University of New York at Albany, warns that the AT&T ruling is based on "specific facts and evidence" that may or may not apply in other cases. Still, many of the circumstances in that case are similar with a potential Comcast bid.

For Disney, a successful Comcast bid could make Disney's planned streaming service less attractive.

In April, the two telecom companies announced a $26.5 billion combination. The deal would combine the nation's third- and fourth-largest wireless companies and bulk them up to a similar size to Verizon and AT&T, the industry giants.

The worry is that with just three major carriers, there would be less incentive to keep innovating on prices and service. T-Mobile and Sprint might even raise prices now that they don't have to try to poach customers off each other.

A 2014 attempt to combine fell apart amid resistance from the Obama administration. But the industry is different just four years later. Wireless carriers aren't just competing with each other, but also with Comcast and others as the wireless, broadband and video industries converge. AT&T is about to get larger with CNN, HBO and other channels from Time Warner. Beyond combining with each other, T-Mobile and Sprint might need its own content acquisition to compete.

CBS has resisted pressure from its controlling shareholder, National Amusements, to merge with Viacom, which also is controlled by National Amusements. The two companies used to be one but separated in 2005.

A combination would reunite CBS's television business with Viacom's production studios, similar to the arrangements now in place at NBC owner Comcast and ABC owner Disney. (On the flip side, the Fox television network and studios would separate under a deal with either Comcast or Disney.)

With Viacom, the $6-a-month CBS All Access streaming service might have a larger library, as Viacom owns MTV, Nickelodeon, Comedy Central and other cable networks.

Verizon, which bought AOL and Yahoo in recent years, could be on the prowl for other entertainment properties. Verizon wants to challenge Google and Facebook in the huge and lucrative field of digital advertising — and having more content could help. There's speculation that CBS could be a potential target. With its main wireless rival AT&T becoming even more of a content powerhouse, Verizon might feel the need to grow.

Rumors have long swirled that Lionsgate might be a potential takeover target by anyone from Amazon to Verizon or even a combined CBS-Viacom entity. Nothing has materialized yet for the owner of the "Twilight" and "Hunger Games" franchises. As a smaller studio, Lionsgate needs to get bigger to compete in the current landscape.

Similarly, Viacom-owned Paramount studio has been on the chopping block before. After years of troubles, it has recently rebounded with the horror film "A Quiet Place" and comedy "Book Club." That could make it a lucrative takeover target by a company seeking content creators.

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.</s>A federal judge handed AT&T a sweeping victory on Tuesday and approved its $85 billion acquisition of Time Warner, a deal that promises to reshape the media industry.

After a six-week trial, Judge Richard Leon ruled that the government had failed to prove that the deal violates antitrust law.

Using unusually strong language, he discouraged the Justice Department from asking him to put the ruling on hold while they consider an appeal. He said such a request would be “manifestly unjust” because it would have the effect of killing the acquisition.

AT&T vowed to close the deal by June 20 — creating a powerhouse that will unite Time Warner’s movies and TV shows with AT&T’s enormous distribution system, including cable, satellite, and cell phone networks.

The deal was announced in October 2016. The Justice Department sued in November 2017 to stop it, arguing that it would harm competition and raise prices for consumers.

AT&T said it needed Time Warner to survive in a rapidly changing media landscape, especially to compete against the likes of Netflix and Amazon.

The judge had the option of rejecting the deal outright or demanding certain conditions, including that AT&T sell some of Time Warner’s assets. But he signed off on the deal with no conditions.

“The Government has failed to meet its burden of proof to show that the merger is likely to result in a substantial lessening of competition,” he wrote in his ruling.

Makan Delrahim, the Justice Department’s top antitrust official, said the government was disappointed in the ruling and would “consider next steps.”

“We continue to believe that the pay-TV market will be less competitive and less innovative as a result of the proposed merger between AT&T and Time Warner,” he said in a statement.

AT&T and Time Warner’s lead lawyer, Daniel Petrocelli, said outside court that the companies were gratified and relieved.

“The case stands as a testament to the wisdom of this combination of these two great companies and how it will benefit consumers for generations to come,” he told reporters.

The judge’s ruling will likely be seen by tech and telecom giants as a green light to pursue a slew of major media acquisitions.

Comcast is widely expected to bid within days for part of 21st Century Fo. That would set up a showdown with Disne, which has already put in a bid for those assets. Fox stock jumped more than 6% in after-hours trading following the ruling.

“Brian Roberts and Team Comcast are cleared to bid,” BTIG Research analyst Rich Greenfield told CNNMoney after the ruling. “The question is whether Disney is ready.”

Related: AT&T-Time Warner ruling: The media industry hangs in the balance

Some of AT&T’s top executives traveled to Washington for the announcement. AT&T CEO Randall Stephenson remained at company headquarters in Dallas, and he learned of the ruling when AT&T general counsel David McAtee called him, a spokesperson said.

The Time Warner deal is a crucial achievement for Stephenson, who views AT&T as competing with Google, Facebook, Netflix and other Silicon Valley giants.

Outgoing Time Warner CEO Jeff Bewkes also learned the news from a phone call, and he was relieved and very happy about the ruling, a spokesperson said.

AT&T announced plans to acquire Time Warner on October 22, 2016. That same day, Donald Trump, then a candidate for president, pledged that his administration would block the deal.

“As an example of the power structure I’m fighting, AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it’s too much concentration of power in the hands of too few,” he said.

More than a year later, the Trump Justice Department sued to stop the deal.

The government alleged that a combined AT&T-Time Warner would have too much leverage in negotiations with television distributors, which would hurt competitors, harm innovation and could lead to increased cable prices for consumers.

AT&T and Time Warner say the combined company can leverage viewer data to make better content to sell more targeted ads, which they claim could help lower prices for consumers.

During the trial, the judge heard from dozens of witnesses, including Stephenson and Bewkes.

Initially, AT&T and Time Warner planned to use a “selective enforcement” defense, alleging that the administration was blocking the deal because of Trump’s dislike of CNN.

But Leon blocked discovery on certain White House communications that AT&T and Time Warner were seeking, and the companies dropped that defense, choosing to litigate the case on pure antitrust grounds.</s>A federal judge has approved AT&T's $85 billion deal to acquire Time Warner. How will the decision impact other telecom and media giants, along with their customers?</s>Shares of AT&T sank about more than 4.8% in overnight trading into Wednesday morning following a judge's ruling that the telecom giant could proceed with its $85.4 billion takeover of Time Warner Cable after twenty months of of uncertainty.

Time Warner were up about 3.6% in early trading Wednesday following the news.

The deal is widely considered to be a harbinger of future media mergers that could radically shift how Americans consume television and movies going forward. Most notably, Disney's ongoing offer to buy 21st Century Fox for $52.4 billion, which Comcast is expected to compete against.

The Department of Justice, as well as President Donald Trump, had originally opposed the merger. The deal could "greatly harm American consumers" through "higher monthly bills and fewer of the new, emerging innovative options that consumers are beginning to enjoy," Makan Delrahim, head of the Justice Department's antitrust division, said when announcing the suit last year.

AT&T rebuffed those claims made by the Justice Department and Trump, saying similar mergers are "routinely approved because they benefit consumers without removing any competitor from the market."

The merger is considered "vertical" because it would combine Time Warner, which makes programming, with AT&T, a distributor of that content, which would then have access to more Time Warner brands like HBO, TNT, TBS, and CNN.
A U.S. federal judge approves AT&T's $85 billion merger with Time Warner.