November 20, 2017 / 10:29 PM / 2 years ago

U.S. Justice Department says AT&T would make rivals pay more for content

FILE PHOTO: The exterior of the U.S. Department of Justice headquarters building in Washington, DC, U.S. on July 14, 2009. REUTERS/Jonathan Ernst/File Photo

WASHINGTON (Reuters) - The Justice Department filed a lawsuit to stop AT&T, which owns DirecTV, from also buying Time Warner, at least partially because of concerns that AT&T would use Time Warner’s films and movies to force rival pay TV companies to pay more for content.

It also said that AT&T would use Time Warner content to slow the industry’s transition to online video and other innovative distribution models.

In its lawsuit, the Justice Department cited AT&T and DirecTV documents saying that, if AT&T closes the Time Warner deal, the merged firm can “operate (its) pay-TV business as a ‘cash cow’ while slowly pivoting to new models.”

Reporting by Diane Bartz; Editing by Bill Rigby

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