By Cristina Caffarra, Gregory S. Crawford & Helen Weeds –
In his recent opinion in the AT&T/Time Warner merger, Judge Richard Leon described the bargaining models presented by the government as a “Kabuki Dance” and a “Rube Goldberg Machine.” We summarize key considerations in recent vertical media mergers in the U.S. and EU and show how AT&T/TW deviated from these in important ways: in failing to consider that the integrated entity might foreclose over-the-top video providers in its role as ISP, in its ready grant of efficiency claims, and in its evisceration of the use of bargaining models in vertical merger analysis. We conclude that bargaining models should be “released on appeal” as a useful framework for analysis in these cases.
