Monday is a watershed day for AT&T and maybe for American antitrust law.

The Dallas telecom giant is scheduled to be in court to defend its proposed merger with Time Warner Inc., a deal that it says will strengthen the companies, spur competition and benefit consumers.

The optimistic pitch may sound familiar. In 2015, when AT&T bought DirecTV to become the world’s largest provider of pay television, it pledged to bring innovations that would reach millions of people.

AT&T promptly created a national plan with TV anywhere. Customers could sign up at an AT&T store and walk out watching NFL football on their smartphones.

The next year, the company launched DirecTV NOW, a streaming service with no set-top boxes, satellite dishes or annual contracts. The introductory offer included 100-plus channels for $35 a month, and by last December, more than 1 million customers had signed up.

That history is important context as AT&T seeks to merge with the owner of CNN, HBO, Turner and Warner Bros. By combining Time Warner’s world-class content with its huge reach in wireless and pay TV, AT&T plans to lead the next evolution in video entertainment.

But this time, the U.S. government has sued to block the deal. Monday's trial in Washington would be the the first time in decades that the feds have litigated a so-called vertical merger — a combination that doesn't eliminate any competitors.

Their primary complaint is that AT&T would withhold Time Warner content in order to drive up prices from rivals or drive subscribers to DirecTV. Consumers would pay higher monthly bills and competition would be substantially lessened, the Justice Department wrote in court filings.

Now the burden is on the government to quantify those threats and prove that stopping the merger is the only way to prevent harm. Based on the case laid out so far, we’re skeptical.

The government's economic expert said average bills would rise 45 cents a month. While AT&T challenges the estimate, the number hardly justifies blocking a $109 billion merger with lots of upside.

What else does Uncle Sam have?

We've supported the deal, confident about competition in the market and intrigued by potential innovations in mobile video and targeted advertising. We also appreciate that AT&T and Time Warner would have more firepower to face tech leaders Google, Facebook and Amazon.

Seven years ago, regulators approved the Comcast-NBC Universal merger, which also combined a distributor and content creator. That agreement included dozens of conditions to protect consumers and competitors, especially Netflix and Hulu.

Since then, the streaming video industry has blossomed with much more content and customer options. So why not offer similar conditions to AT&T?

Many believe the difference is President Donald Trump. He’s railed against CNN for its critical coverage and, as a candidate, opposed AT&T-Time Warner. But Trump isn’t mentioned in AT&T’s latest filings, a sign that politics may live in the headlines and die away in the courtroom.

Ultimately, this case should be about competition. Are AT&T and Time Warner teaming up to slow down online rivals and milk the legacy pay-TV business? Or are they gearing up to create a new way in mobile entertainment?

The companies said they're not trying to hold back the tide but to ride an irresistible wave.

The government must prove otherwise or get out of the way, and let AT&T and Time Warner get to work on the future.

Promises, promises

Potential innovations from the AT&T-Time Warner merger:

•Offer a free mobile video service to AT&T customers with Turner and select cable networks. Others could get the same deal at a nominal price.

•Create specialized bundles of video for a mobile audience.

•Integrate video content with social media apps so consumers can clip and share videos on smartphones.

•Build a targeted ad platform for pay TV and digital, which could let viewers reduce the number of ads or shift more costs to advertisers.

•Use customer data from AT&T to inform Time Warner’s programming, scheduling and marketing.

SOURCE: Pretrial brief by AT&T, DirecTV and Time Warner

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