I have said for weeks that President-elect Donald Trump will not support the AT&T-Time Warner if, in his view at least, CNN continues to hammer him with negative coverage.
Since Time Warner owns CNN, Trump would regard approving the merger as rewarding, and reinforcing, the news network’s direction.
My analysis was recently confirmed by Bloomberg News which said in a January 5th article that Trump now opposes the AT&T-Time Warner largely because of CNN.
Since Trump’s press conference last week in which he shouted down a CNN reporter, and called the network the provider of “fake news,” an industry consensus has developed that CNN is indeed an obstacle to the merger’s chances. In fact, considering that Trump and his advisers are normally pro-business, CNN may be the only serious obstacle.
Consequently, industry analysts have speculated that AT&T will agree to sell CNN to appease Trump, and win his support for the deal.
But here’s the problem with that scenario.
What company would want CNN in its portfolio now knowing that the incoming president detests it, and is not beneath acting on his hatred to hurt whatever company owns it? I can’t think of a single company that might be considered a CNN suitor that doesn’t have at least some business with the federal government.
For example, would ABC buy CNN knowing that the Trump administration might spurn any future merger involving its owner, Disney? Not likely.
Would CBS have interest? No way. The network has a number of ongoing initiatives that require a kind hand in Washington, and it’s not impossible that CBS might soon propose its own merger.
What about a wild card buyer, such as Google or Apple? Again, they work hand-in-hand with the feds on many important company policies and certainly couldn’t risk blowing that with one acquisition.
No, it would appear that CNN has become the equivalent of the ‘Old Maid’ in Time Warner’s deck, the card that no one wants because its holder loses the game. Time Warner and AT&T probably can’t sell CNN, and they probably can’t pressure it to tone down its coverage of Trump because the media would have a field day covering that when it leaked. (And, of course, it would leak.)
So what will happen? I still think the merger is dead because of the toxic relationship between Trump and CNN. It’s certainly possible that CNN will somehow try to placate the president-elect, but it’s probably too late for that.
— Phillip Swann