AT&T has suggested that it might not need Federal Communications Commission approval of its purchase of Time Warner Inc., but that may just be wishful thinking.

Some news organizations have reported that Time Warner has only one FCC license, for a TV station in Atlanta, and that the AT&T/Time Warner merger wouldn't be reviewed by the FCC if Time Warner sells that TV station to a third party. That is not correct, however. Time Warner programmers such as HBO, CNN, and Turner Broadcasting System also have dozens of FCC licenses that let them upload video to satellites used by pay-TV companies.

These licenses are crucial for distributing video to cable TV providers. It isn't only satellite TV companies like Dish or the AT&T-owned DirecTV that use satellites to send programmers' video to consumers' homes—even cable companies like Comcast use what's called a "headend in the sky" to receive and distribute video.

The FCC's list of active satellite Earth station licenses shows that CNN America has 36 such licenses covering operations at specific locations. HBO and HBO Latin America have a combined seven licenses, and Turner Broadcasting System has 14 licenses. That's 57 licenses that could trigger an FCC review. Licenses for some of the same locations were part of the FCC's review of Time Warner's merger with AOL in 2001.

AT&T would love to avoid an FCC review, which in the past has killed deals such as AT&T/T-Mobile and Comcast/Time Warner Cable. (Note that Time Warner and Time Warner Cable are completely separate entities and that Time Warner Cable is not involved in the AT&T deal.)

AT&T's announcement of its Time Warner deal said that the companies are still "determining which FCC licenses, if any, will be transferred to AT&T in connection with the transaction," suggesting that it may not need to seek FCC approval of license transfers at all.

While the Department of Justice could sue to block the AT&T/Time Warner merger on antitrust grounds, the FCC reviews deals based on a "public interest" standard that forces the merging companies to prove that the deal is good for consumers.

Application is required but hasn’t been filed yet

The FCC hasn't commented specifically on AT&T/Time Warner, but an FCC spokesperson told Ars today that transfer of the satellite Earth station licenses would require the companies to file an application for transfer. The FCC would perform a public interest review that includes giving the public plenty of time to comment on the proposed transaction, just as the FCC has done with other major mergers.

While Time Warner could sell off the properties with the licenses, that also would require an application to the FCC and trigger a public interest review. Such a move might not make sense in either a business or regulatory sense. "If we're talking about licenses integral to their businesses, trying to divest them to avoid FCC approval smacks of evasions, and I think the FCC would look askance at such an effort," one industry lawyer who spoke with Ars earlier this week said.

While most license transfer reviews are simple, unopposed, and processed quickly, significant transactions are reviewed thoroughly.

The FCC has not yet received an application for license transfers from Time Warner to AT&T, but it isn't unusual for there to be some time between the announcement of a merger and the application filing, a commission spokesperson said.

AT&T has said it expects the FCC to have "a seat at that table" when the Department of Justice does an antitrust review. But AT&T still hasn't publicly committed to seeking FCC approval for license transfers, and the company has not answered our questions this week. (UPDATE: AT&T responded to us after this story published. The company repeated its earlier statement that it is still determining whether any Time Warner licenses will be transferred to AT&T, adding, "We take a very simple approach here: we follow the law and so whatever the law requires, that's always what we'll do.")

An FCC review wouldn't necessarily sink AT&T's $85.4 billion purchase of Time Warner. AT&T knows the process well, having used it to gain approval of last year's acquisition of DirecTV.

The AT&T/Time Warner merger is being criticized by various consumer advocacy groups and could raise concerns at the FCC. As we've previously written, owning Time Warner would give AT&T incentive to raise the prices that its rivals (such as Comcast, Charter, and Verizon) pay to distribute Time Warner programming on their cable TV systems, which could indirectly raise consumers' TV bills.

AT&T could also harm online video services that compete against DirecTV by charging them higher prices for content or refusing to license videos. AT&T could favor Time Warner video on its mobile network by letting it stream without counting against the data caps applied to video services like Netflix.

The FCC has recently used merger reviews to limit the harm Internet service providers can do to online video services. In the AT&T/DirecTV merger, the FCC barred AT&T from exempting its own online video services from home Internet data caps that are applied to competitors (though this condition was not applied to mobile networks).

When Comcast tried to purchase Time Warner Cable, the FCC refused to approve the deal largely because a bigger Comcast would have posed an "unacceptable risk" to online video. AT&T claims that there won't be any negative consumer effects of its purchase of Time Warner because they don't compete directly against each other, but that's for the Justice Department—and likely the FCC—to decide.