When companies merge, their main reason is to become more competitive or to expand their services. That's the reason that makes most sense...most of the time. But if we think very detailed about the AT&T-Time Warner merge, there is no reason, or at least a logical reason why they planned to merge, because AT&T faces almost no real competition.
CEO Randall Stephenson says "We entered this transaction for many reasons, but those reasons all boil down to one thing — we want to get the most content to the most people at the lowest prices, delivered on any screen, particularly mobile” Sounds to us like a very soft way to describe Monopoly. Doesn't it?
In theory, only horizontal integration can lead to monopoly, but in the case of media nowadays this so called "vertical integration" isn't just another type -or a bastard son- of monopoly? Media cannot be compared to a production company that specializes in, for example, packing potato chips and only potato chips. Media can only be compared to a company producing potato chips, canned coconut water, underwear, toys, shoes, medicines, home decor items, etc. So, vertical integration in media companies is just an illusion.
You would think that the first time the Bell System was broken up back in 1984 would be enough. But somehow, all the baby bells want to be the big family they once were, whether that is with their "real relatives" or not. Nostalgia or money/power interest. You decide.
Why this merge will be bad for you as a customer (and why Bernie Sanders thinks is consequential to our democracy):
- You will be left with just a couple of options: What is left if they merge? pretty much just a few other companies. Your options will be noticeable limited and you will have to accept whatever services they offer at the price they want.
- Customer service standards: If they become even bigger, do you think customer service will be a priority? We don't think so
- Bigger not always means better: We don't really know if all these new services will be charged or if your current bill will increase at all because of the "updgrades". Did we mention poor customer service? (yes, we did) And, have you thought about all the influence they will have? Influence in almost anything (Mega Corp™ much?)
These are our thoughts, feel free to let us know in the comments below what do you think. We'd LOVE to hear your opinion.