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AT&T To Acquire Media Giant Time Warner For More Than $85 Billion

RACHEL MARTIN, HOST:

It is one of the biggest media mergers in years. AT&T announced last night that it will buy Time Warner, the owner of CNN and HBO, for about $85 billion. The deal was approved by the boards of the two companies yesterday. It still has to be approved by regulators. We're joined from our studios in New York by NPR's Jim Zarroli to talk about all this. Good morning, Jim.

JIM ZARROLI, BYLINE: Good morning, Rachel.

MARTIN: What did AT&T say about the deal and why it wants it to happen, what it hopes to get out of it?

ZARROLI: Well, in its statement, it said a lot of the usual things companies say with deals like this. The CEO of AT&T, Randall Stephenson, said (reading) this is the perfect match of two companies with complementary strengths who can bring a fresh approach to how the media and communications industry works for everyone. I mean, the thing is AT&T is a big communications company. It has, you know, wireless business and landline and a lot of digital and internet customers - millions of customers, really. But a lot of these are mature businesses. They're not going to grow. So, you know, there are all these changes taking place in the media world, and AT&T is basically just trying to get out in front of them.

MARTIN: All right, so how does this deal do that?

ZARROLI: Well, you know, the way people get content has really changed. They're - you know, they're cutting the cord on cable. They're getting programming through smartphones and wireless devices. So AT&T has this vision of, you know, this giant network that lets customers see the programs they want on any device any time that they want. It says that their customers really want this, that they're - they want to be able to access programs when they want them.

MARTIN: So what does AT&T get by folding Time Warner into this vision?

ZARROLI: Well, Time Warner, as you know, is a content provider. It - you know, it owns Warner Bros. Studios. It owns HBO and TNT and CNN. And so it has a lot of really popular programming like, you know, "Game Of Thrones" and the "Harry Potter" movies.

MARTIN: Yeah.

ZARROLI: So presumably, that gives AT&T a leg up. But this is really a return to the idea of, you know, bringing content and distribution together somehow, which the media had sometimes - has sometimes seemed to be moving away from. But really, again, I think it's just an effort by these big companies to be positioned to react to the changes taking place as well as possible.

MARTIN: So as we noted, the merger was approved by the boards of the companies yesterday. But this is complicated. It's a big deal. When will it actually go through?

ZARROLI: Well, it's going to take a while. Probably not at least until the - you know, the end of next year because there's going to be the usual regulatory approval process. The Justice Department has to approve it. There's already a sense, I think, among regulators that they have been quick - too quick to approve deals like this in the past, such as, you know, the Comcast-NBCUniversal deal. So there is bound to be something of a fight over this.

You're already hearing, you know, some criticism from consumer groups that this - these kinds of deals just concentrate too much media power in the hands of a big company. And actually, Donald Trump, you know, the Republican presidential nominee, of course, said basically the same thing on the campaign trail yesterday. He said if he's president, he will reject the deal. There hasn't been any word from the Clinton campaign on that.

MARTIN: NPR's Jim Zarroli breaking it down for us. Thanks so much, Jim.

ZARROLI: You're welcome. Transcript provided by NPR, Copyright NPR.

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