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US Government Sues AT&T/DirecTV, Calls It 'Ringleader' of Collusion Scheme (arstechnica.com)

Posted by BeauHD on from the non-public dept.

An anonymous reader quotes a report from Ars Technica: The Department of Justice today sued DirecTV and its owner, ATT, saying the satellite TV company colluded with competitors during contentious negotiations to broadcast Los Angeles Dodgers games. Dodgers games have been blacked out in much of Los Angeles because pay-TV providers have been unwilling to pay the price demanded by SportsNet LA, the Dodgers channel operated by the baseball franchise and Time Warner Cable. But the DOJ's antitrust division placed the blame for this situation on ATT and DirecTV. In a complaint filed in U.S. District Court in California, it alleges that DirecTV was a "ringleader" in a coordinated scheme with cable companies Cox and Charter, according to a DOJ announcement. ATT completed its purchase of DirecTV in July 2015, but the complaint covers a dispute that began before the merger and continues to this day. The Dodgers channel owners offered carriage licenses to the pay-TV companies in January 2014, but the channel is still not available on DirecTV, Cox, or ATT's wireline TV service. (Games are now available on Charter, which purchased Time Warner Cable this year.) The lawsuit "alleges that DirecTV unlawfully exchanged competitively-sensitive information with Cox, Charter, and ATT during the companies' negotiations for the right to telecast the Dodgers Channel," the DOJ announcement said. "Specifically, the complaint alleges that DirecTV and each of these competitors agreed to and did exchange non-public information about their companies' ongoing negotiations to telecast the Dodgers Channel, as well as their companies' future plans to carry -- or not carry -- the channel." The companies used this strategy "to obtain bargaining leverage and to reduce the risk that they would lose subscribers if they decided not to carry the channel but a competitor chose to do so." The information these companies learned from each other "through these unlawful agreements" was a major factor in their decision not to carry the Dodgers channel, the complaint said. ATT said it will fight the lawsuit and blamed Time Warner Cable for charging unreasonably high prices. The asking price was reportedly about $5 a month per subscriber regardless of how many people watch the games.

15 of 113 comments (clear)

  1. Sports money by Calydor · · Score: 5, Interesting

    Imagine if all the money the world spends on sports would, for just one year, be funnelled into things like getting people out of poverty, creating jobs, curing cancer, building infrastructure ...

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    -=This sig has nothing to do with my comment. Move along now=-
    1. Re:Sports money by Luthair · · Score: 2

      I'm not sure I want the people watching it with more time on their hands, imagine the damage they could do to the world!

    2. Re:Sports money by Anonymous Coward · · Score: 3, Insightful

      It does create jobs - for the hot dog vendors, ticket salesmen, parking attendants. It also pays for the athletes and so forth. Arguably, this is a better way to get someone out of poverty than handing them money.

    3. Re:Sports money by Gryle · · Score: 4, Insightful

      Imagine if all the money the world spends on $THINGIDONOTCAREFOR would, for just one year, be funnelled into $THINGSIDEEMMOREIMPORTANT...

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      Only two things are infinite, the universe and human stupidity, and I'm not entirely sure about the universe - Einstein
    4. Re:Sports money by Calydor · · Score: 3, Insightful

      Socialism is taking your money against your will and shoving something down your throat that you never asked for.

      You mean like paying five dollars a month for a sports channel you don't watch?

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      -=This sig has nothing to do with my comment. Move along now=-
    5. Re:Sports money by tepples · · Score: 3, Insightful

      Cable/satellite is a choice, it's not required.

      Satellite TV is a choice. But cable TV often isn't, as cable ISPs and fiber ISPs in the United States tend to tie it with their home Internet service, charging less per month for TV and Internet than for Internet alone. Or is home Internet service itself not a necessity to find and keep a job that pays a living wage in the United States?

    6. Re:Sports money by orgelspieler · · Score: 3, Insightful

      Honestly, I know you are pointing out the absurdity of the argument, but you have a good point. There is a surprising number of things that people would be able to build consensus on. Depends on what we put in those columns. I think things like the war on drugs, or the TSA would be good examples. But it's hard to know for sure what people really would support if they knew all the facts.

      The problem with looking at luxury items as things that shouldn't have money spent on them is that it fails to take into account the knock-on effects. The NFL employs a bunch of people. Sure, the fatcats at the top make more than they should, but Joe Cameraman isn't getting millions of dollars, even if he's the best out there. The old lady making the crappy pizza at the concession stand is probably eeking out a meager existence. Should we be docking their pay for a whole year so that we can finally get rid of a disease or build a new library? I don't know, but it seems like most Americans would answer no.

      If we -- as a society -- wanted to cure cancer instead of watch football, people would be donating to M.D. Anderson instead of buying Texans tickets. We vote with our wallets every day.

    7. Re:Sports money by k6mfw · · Score: 2

      yeah right, as someone else pointed out millions to the athlete and billions to the corporations but trickles to the hotdog vendors. They may do alright along with many others working the stadium. The ones I think should be reasonably paid are NFL cheerleaders. They are professional dancers of quality class like Broadway, showdance, and open pro competitions. The auditions are tough, requires candidates with formal dance training, athletic endurance with ballet precision. It takes more than just being pretty, they put on a show for the audience with technique and presentation of lots of "wow" factor. They are not salaried like the football players, they do get a stiped for each game. However, they have to be employed (cannot be still living with parents) and being enrolled in college or raising a child is accepted as employment.

      I've been to a couple big games in my life, there is the new Levi Stadium in Santa Clara (where they had Superbowl 50) but to me it is as distance as Olympic stadiums. I've heard cost per seat is so high most are purchased by companies for their clients and employees. I could be wrong, I don't have much interest in football and don't keep up with the news (was it the Cleveland Lakers that won the Superbowl?).

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      mfwright@batnet.com
  2. Re: Market Competition by Entrope · · Score: 4, Insightful

    Declining to charge every one of your customers $5+/month for a TV channel dedicated to one team sounds like a good way to hold down prices and do the right thing for the public.

  3. Comment removed by account_deleted · · Score: 3, Informative

    Comment removed based on user account deletion

  4. Re:Missed opportunity by 110010001000 · · Score: 3, Interesting

    Uh, that would be a disaster for the Dodgers. Instead of getting a cut of every subscriber (of which probably 10% actually watch Dodger games), they would only get a cut of those who actually watch Dodger games.

  5. Same thing happened in Houston by yzf750 · · Score: 4, Interesting

    Comcast, the Astro's and the Rocket's started Comcast Sportsnet Houston about 3 years ago. Lots of local sports content, HD shows and of course all the games live. ATT, DirecTV and Dish all refused to carry the channel. The content gradually shrank to infomercials except when a game was on, then finally the channel went into bankruptcy. ATT then bought the remains and the same day launched Root Sports. Dish and DirecTV both picked the channel up. Interesting how it happened in LA too...

  6. Re: Market Competition by sethaw · · Score: 2

    The problem is by colluding with the other providers you prevent customers who want to pay an extra $5 from being able to see it. They end up having to pirate the games or go without watching. If some providers offered it and others didn't then the customer could look at two providers' prices and channels and choose which one is better for them. With collusion both providers will end up with the same content at the same price and you either hurt the customers who don't want to pay the extra $5 or you hurt the customers who want the channel.

  7. And that's why we need MORE MERGERS! by jeffb+(2.718) · · Score: 2

    See, if AT&T already owned Time Warner, there'd be no issue here -- instead of "illegal collusion", this would just be a responsible and well-run company maximizing value for its shareholders.

    Now, where did I leave that sarcasm tag...

  8. Re:Cut the cord... by tepples · · Score: 2

    That's sort of hard to do when ISPs charge home Internet customers extra for not having TV.