AT&T Promised Lower Prices After Time Warner Merger -- It's Raising Them Instead (arstechnica.com)

Less than a month after AT&T completed its $85 billion acquisition of Time Warner, the company is raising the base price of its DirecTV Now streaming service by $5 per month. This comes after promising in court that its acquisition would lover TV prices. Ars Technica reports: AT&T confirmed the price increase to Ars and said it began informing customers of the increase this past weekend. "The $5 increase will go into effect July 26 for new customers and varies for existing customers based on their billing date," an AT&T spokesperson said. The $5 increase will affect all DirecTV Now tiers except for a Spanish-language TV package, AT&T told Ars. That means the DirecTV Now packages that currently cost $35, $50, $60, and $70 a month will go up to $40, $55, $65, and $75. "To continue delivering the best possible streaming experience for both new and existing customers, we're bringing the cost of this service in line with the market -- which starts at a $40 price point," AT&T said.

In a court filing, trying to convince the Justice Department that its acquisition would be good for consumers, AT&T had this to say: "The evidence overwhelmingly showed that this merger is likely to enhance competition substantially, because it will enable the merged company to reduce prices, offer innovative video products, and compete more effectively against the increasingly powerful, vertically integrated 'FAANG' [Facebook, Apple, Amazon, Netflix, and Google] companies," AT&T told U.S. District Judge Richard Leon in the brief.

Comments

It can't be

[narcc]

I'm in total shock. Who could have possibly seen this coming?

Re: It can't be

[irving47]

Hell, I own stock/get AT&T dividends, and not even I'm buying that crap.

Re: It can't be

[alongley]

My recollection is that there used to be hundreds of little ISPs that served the Internet up over dial-up phone lines. Over time of course the state of the art became DSL, coax cable and fiber. The broadband infrastructure is and was always owned by a variety of big companies. But the bottom line is that for one reason or the other all the small ISPs have been bought up by the big players, the Bells have been remerged into AT&T due to deregulation, and there has been considerable consolidation in the cable space, leaving most consumers without a lot of choice. AT&T in the summary essentially parrots this. No one is doubting that there is regulation, but I would need to see something more than your post to draw any conclusions about whether lots of regulation keeps little guys from starting ISP businesses or if it's really just the big companies being anti-competitive. Certainly there used to be lots of little ISPs but perhaps the landscape has shifted to much more regulation in the last 15 years? By all means, back up your post with some substance.

Re: It can't be

[DogDude]

Oh, stupid AC troll. Internet access needs to be 100% regulated, just like our electrical utilities. It'll be cheap, and it'll work.

Re: It can't be

[dinfinity]

Wrong. Free markets evolve towards consolidation and the only thing that prevents that is government regulation.

Do you think it is a coincidence that all mature markets are highly consolidated? The oligopolies you speak of are the (crappy) compromises of the free market desire for monopolies and the people's desires for perfect competition.

Another topic herein is the concept of 'cartel forming'. It's a dirty term, even for libertarians, yet it is utterly rational behavior from the perspective of the companies involved. In fact, in other areas of life, we would use words like 'alliance' and 'cooperation' to characterize the behavior. Buying up competing companies or trampling them is equally rational from the perspective of the companies and thus that is exactly what they will do, given the opportunity.

The takeaway here is that the concept of an unrestricted free market fundamentally stabilizes on a highly undesirable state of affairs from a societal point of view.

Now, having established that, finding a good way to deal with it is hard. Asking companies to 'take their responsibility', semirandomly blasting them with huge antitrust fines or breaking up companies above a certain size seem like terrible workarounds to me. One of the more creative ideas I've come across is taxing companies progressively based on their dominance in their respective market(s), but that too seems far from flawless.

Re: It can't be

[The Evil Atheist]

The government let this merger happen. That is the opposite of regulation. Of course, in the bizarro world of libertarians, government not stopping a merger is somehow another government regulation. "Left wingers" would be against mergers and the creation of monopolies.

Re: It can't be

[sjames]

If you think right of way is hard now, try doing it without government, that is, by negotiating individually with each and every property owner in the area you intend to serve.

Re: It can't be

[AHuxley]

Re It'll be cheap, and it'll work.

Make all US internet into one big utility cooperative https://en.wikipedia.org/wiki/... ?
Connect all the cooperatives and span the USA?
That would be some neat deregulation and removal of all federal rules and no more NN rules.

Re: It can't be

[Anonymous Coward]

The parent makes a good point, and one I was going to make. Simply put one of the reasons AT&T didn't want to upgrade their lines was they didn't like others providing DSL. Now the lines are on public easements and AT&T probably even got subsidies and such to put a lot of them in.

Even now countless AT&T customers are without any form of hard wired broadband and this is well after the court case you mentioned. Simply put companies like AT&T only do what is profitable, and then only in the short term. Now I think the theory goes, that AT&T has absolute ability to do what the hell they want, they will suddenly find more places profitable and run lines. I'm not sure that theory is sound, but even if it is, it probably isn't ethical.

I'm of the opinion that government has an absolute duty to provide internet at a fair price, if the local players don't play, or are screwing over their customers. Now they can contract it out, but they need to keep control and not just do all the work and let AT&T make all the profits. Beyond that, you need al la carte pricing for everything. This bundling everything crap has to die. A data provider provides bits, including some with quality of service guarantees such as for phones. If the customer wants to add filters, then by all means, but that is the end of it.

Companies like AT&T that work pretty much against the public interest and don't meet their previous commitments to the public should be given the corporate death sentence and be run through the shredder again.

Re:It can't be

[Anonymous Coward]

No he didn't, he's a retard who blathered something once.

Re: It can't be

[Required Snark]

Stop masturbating to your picture of Ajit Pai and listen up, you right wing tool. Since Ronald Reagan the Republican Party has been successfully trying to eliminate all Federal regulation on big business and this is the inevitable result. We live in a country run by and for the Telco cartel, the pharmaceutical cartel (currently killing Americans by pushing legal opioids), the agribusiness cartel (just gone international now that Bayer purchased Monsanto), the bank cartel (Wells Fargo is the bank equivalent of a child molester who keeps on hurting kids because his uncle is the judge), Wall Street in general (who almost wrecked the word economy in 2008, was bailed out at the expense of everyone else, including you, and is now making even larger profits, and now has lower taxes and even less regulation.)

The Democrats, feckless as they may be, are the opposition against the slide into plutocracy and oligarchy. To call them out shows that you are a committed fascist.

Why don't you get the hell out of my country and live in Russia under Putin? He embodies the corrupt centralization of power that you endorse. Your would fit right in.

Re: It can't be

[Gavagai80]

Breaking up the Bell monopoly was a pointless exercise, because the way it was done simply created a bunch of regional monopolies with no competition between them. Nobody movies to another state to get a lower price on their telephone / TV / internet. We got all the disadvantages of Ma Bell, with additional inefficiencies added.

Re: It can't be

[AmiMoJo]

Most countries solve this with "local loop unbundling". Basically the company that owns the phone lines and telephone exchanges has to offer access to other companies for the same price it charges itself. Other companies can install their own hardware at the local exchange (an ADSL DSLAM box) and offer internet service to anyone who wants it.

It's not perfect because the company that owns the lines tends to be really really shit at maintaining them, but at least you have a choice of ISPs.

Re: It can't be

[h33t l4x0r]

I lived through it and I remember lower prices and better options. Are you arguing that we should leave monopolies alone? Because who the fuck exactly are you?

Re:It can't be

[parkinglot777]

AT&T lied, and that's news? I knew they'd raise prices, but I figured they'd wait a little bit longer to do it just to keep from being so damned obvious about their lying.

Actually on the other hand, AT&T may try to advertise it a different way. If the base price is now $5 higher for new customer, it is then become the current base price. Existing customers now have the "lower" price because of the base price is higher than what they are paying; thus, it is a discount for existing customers. Not that I agree with the lie, but this is how corporations could spin their way through. I wish that the court could reverse the approval.

Re: It can't be

[stealth_finger]

I know it's difficult for left-wingers like yourself who have never even tried to run a sustainable, nevermind a profitable, business to understand this, but the lack of competition within the telecom industry is solely due to the extensive regulation that effectively makes it impossible for new entrants to participate in the market. Before you start with the 'natural monopoly' nonsense regarding infrastructure, you should realize that the only monopoly involved and causing problems is that of the government and its oppressive regulation. Technological difficulties can be overcome, even by relatively small players. Regulatory difficulties, on the other hand, are far worse to deal with, and in the telecom sector are nearly impossible to overcome except by the very largest players, and even they often experience extreme hardship. We see the problems we have today because left-wing regulatory schemes have paralyzed the market, resulting in the formation of an oligopolistic environment where the consumer ultimately suffers.

Completely and utterly wrong. Why don't you have a look at some other markets. How is it you think that having only one company is competition? I know you'll shit yourself but why don't you look at the models in european countries where infrastructure is largely separated from the ISP and there are actually lots of ISPs in competition with each other which does result in lower prices, uncapped lines and half decent customer service.

Re: It can't be

[Bryansix]

I'm a Republican/Libertarian and I wanted the companies to be allowed to fail. The bailouts were the problem. Failure needs to hurt otherwise people just keep doing the same things over and over again.

Re: It can't be

[HeckRuler]

but the lack of competition within the telecom industry is solely due to the extensive regulation that effectively makes it impossible for new entrants to participate in the market.

So Google can't make any money with their fiber business. That's because even after they sort through all the legal bullshit about who is allowed to touch what telephone poles (which is a completely and legitimate aspect of your argument), the telecoms simply drop the price in the area and subsidize those operations with heavier fees elsewhere. Classic under-cutting. Hey! Competition drops prices! WOOOO! Good times for the customer. In the few handful of places where Google as tried to come to town. Because they can't make money. Because once you own a (near) monopoly, it's easy to shut out even Mr. money-bag Google.

Now, the fundemental aspect of running multiple utilities to all the houses in a city IS INDEED a natural monopoly. Not an impossible one to overcome. Way better than... sewar or water, and better than rules of right of way on a river. If you want to really blame government though, it's the local municipalities that build the telephone infrastructure. They paid for it, they want to charge the telecoms to access it right? Makes sense. Seems fair. BUT the telecoms was exclusive rights to the poles. And they'll pay for it. THAT is fucking bullshit. On the flip-side, having different utility teams repeatedly snipping competitors cables would suck. I'm not sure how to fix that if it became a problem. Hell, why not mandate body cameras for the linemen. But oh noes! ebil gov'mint interference!

You right-wingers need to stop assuming that government is to blame for everything. What next, did it curdle your milk? Did it make your kid autistic?

I'm shocked

[MightyMartian]

I'm shocked, I tell you, shocked!

Dear Sherlock,

[Hallux-F-Sinister]

No shit.

AT&T Promised Lower Prices After Time Warner Merger -- It's Raising Them Instead

Re:Dear Sherlock,

[Anonymous Coward]

It was a negative price decrease. See, Justice Department, a perfectly cromulent price adjustment.

I don't think it's related to the merger...

[Espectr0]

I think it's more like "Youtube did it, Playstation Vue did it, so can we".

Everybody's doing it and it will be going up if they are going to keep putting their money into developing their own tv shows.

Words Matter

[Anonymous Coward]

'enable to reduce' does not mean 'will reduce'. Stop reading what you want to see and instead read what's actually there.

Re:Words Matter

[Iamthecheese]

A lie by weaseling is still a lie.

Re:Words Matter

[novakyu]

Frankly at this point, anybody who expected a good-faith action from AT&T deserves what they got. AT&T will not keep any of its implied promises unless they are contractually bound to perform it—and even then, it will probably get its lawyers working on a way to find a loophole.

Libz Predicted it & Conservatives will blame L

[corezz]

Every liberal economic pundit predicted this would happen. Simple economics.

Most conservatives eagerly yearned for this merger and a conservative judge allowed it to proceed. Now they are blaming Liberals for letting the merger happen. The only question this time around is, will conservatives blame Mexico or a non-white group of people for the rise in prices. That's always what it comes down to.

Consequences

[currently_awake]

This clear case of lying in court can have 1 of 4 results: 1-Arrest the board of directors of AT&T for perjery. Five years in prison sounds about right. 2-The Judge issues an order to undo the merger. 3-The Judge orders AT&T to drop prices by twice the increase, and keep them there for 5 years. 4-The party of the 0.01%ers can cheer small government, where small government means eliminating rules and laws that limit the ability of the rich to fleece the sheeple.

Re:Consequences

[fafalone]

As a non-violent crime that only has a small impact on some peoples finances, a custodial sentence is absolutely not appropriate. We need to be locking up less people for non-violent offenses, not more, instead states let out violent offenders to make room.
What should happen is extremely steep fines for them, to be paid from their personal holdings, with a absolute bar on continuing to work in the industry for at least 10 years. The fine should be based on their wealth; e.g. if their total net worth (and not just liquid assets) is $100m, fine them $30m (increase the percent sharply with wealth; less if poorer, more if richer), with a penalty of triple that if they get caught trying to hide assets for the assessment.
Just as effective as a few years in jail.

Of course . . .

[hduff]

Who did not see this coming . . .

remove monopoly and allow gov to put in fiber

[WindBourne]

Seriously, some of the best set ups is local gov running and owning the fiber, and then allowing a limited time monopoly managing it, ideally, allowing multiple providers over the fiber.
BUT, at the least, it is time to destroy the monopolies.

Re:Libz Predicted it & Conservatives will blam

[Anonymous Coward]

The Trump administration (republican) predicted it and sued to stop the merger. Your Fake News didn't mention that.

I promise to fuck harder!

[Tyr07]

Dear Consumers.

I understand lately you have had multiple choices from different providers, so we couldn't fuck you as hard as we wanted to because you would just switch. We're tired of this game where only one company gets to fuck you a little bit, then you switch and they get to fuck you a little bit.

Well, we're increasing the value of our offer and the quality of it. We're making sure that you don't have to worry about strange partners fucking you, or unknown STDs.

This way you're certain to be fucked by only us, and you'll know what kind of fucking you'll get, no surprises.

Even though those other companies we listed as threats actually have no control of your internet access, just in case, we made sure we fucked you first. We all know you don't forget your first fucking, and we're there all the way.

Sincerely,
AT&T.

P.S We said you would be the only one we would love. We lied, we were fucking other people while fucking you. You consumers always fall for that.

Re:AT&T has this history...

[ilsaloving]

And those who do learn from history are doomed to watch everyone else repeat it.

Re:/. headline is misleading

[scottragen]

Since when did a promise need to contain the word promise? Saying "it will enable the merged company to reduce prices" sounds like a promise to me. When I say "I will take you to the park after lunch" to my kids, they rightly take that as a promise.

Re:Libz Predicted it & Conservatives will blam

[Anonymous Coward]

The Trump administration (republican) predicted it and sued to stop the merger. Your Fake News didn't mention that.

Bzzzt! Wrong.

The Trump administration opposed the AT&T -- Time Warner merger because Time Warner owns CNN. Trump hates CNN because they aren't sympathetic to him, like Fox News is.

Fake news is a deliberate fabrication, written to deceive, confuse, or enrage (e.g., Pizzagate.) It is not the same as news with errors. It is not even the same as news written with a bias. Fake news is written by fake reporters.

Trump, on the other hand, defines fake news as anything he doesn't agree with.