Justice Department Alleges Collusion in DirecTV Case

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The Justice Department has recently filed an antitrust lawsuit against AT&T, Inc.-owned DirecTV, alleging unlawful information sharing with rival pay-television providers in regards to the decision to carry a premium Los Angeles-based sports channel owned by the area baseball team, the Dodgers.

SportsNet LA was launched in 2014 by Time Warner Cable to carry Dodger baseball games for fans; however, although the cable company believes the content it has a 25-year license to distribute is dear, AT&T, DirecTV and other media outlets don’t agree.

AT&T, DirecTV & Rivals 

AT&T held that DirecTV is being accused of sharing information with three major television then-rivals: AT&T, Cox Communications and Charter Communications. This information pertained to the decision to not carry SportsNet LA, and the Justice Department alleges the competition was told DirecTV wasn’t intending to carry the pricey channel any time soon, so the competitors involved agreed they would also not carry it.

AT&T has responded, according to the Wall Street Journal, explaining that “no one wanted to force all of their customers to pay the inflated prices that Time Warner Cable was demanding for a channel devoted solely to LA Dodgers baseball.” Although AT&T paints a picture of a company with its customers’ best interests at heart, collusion remains a very serious allegation – and not one made lightly.

There’s More to the Story 

This is a story about a lot more than Dodgers baseball, though for plenty of LA residents that’s enough reason to want to see AT&T punished severely.

Collusion disrupts fair marketplaces and takes the choice out of the hands of customers. Instead of having the option to go to Cox Cable or UVerse to get their favorite Dodgers channel as an add-on package, these customers literally could not access it at all. In short, collusion blocks access to markets and prevents businesses from fairly practicing their trade.

The Justice Department also fears a bigger problem. With AT&T working hard to acquire Time Warner and an antitrust review expected before the deal can be completed, concerns are mounting that AT&T will have too much power to manipulate the media and block any channels or distributors it deems unworthy without customer consent.

 

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