Satellite Dishes That Power Time Warner Imperil AT&T Deal

Behind the Time Warner campus in Atlanta (GA), more than a dozen massive dishes silently stream CNN newscasts, Cartoon Network shows and Turner Sports games to satellites in outer space. They’re a vital link in the media giant’s global news and entertainment business. But they operate under licenses from the Federal Communications Commission, which means they also could be the biggest threat to Time Warner’s aspirations to merge with AT&T.

Time Warner has dozens of FCC licenses. Transferring them to AT&T would trigger a review by the agency, and the company is looking for ways to avoid that, according to a person familiar with the situation. Otherwise, the $85.4 billion deal could be exposed to an agency that’s been a graveyard for mergers. In theory, Time Warner could sell its dishes to an unaffiliated third party and enter into a contract with them for the same services -- but in that case, the buyer would need to ask the FCC for a license to provide services in the same location over the same airwaves, said Andrew Jay Schwartzman, senior counselor at the Georgetown University Law Center in Washington. It’s possible the FCC would accept the application without a fuss, Schwartzman said. But, he said, FCC officials also might say, “Wait a minute! We’re not stupid -- you are evading this review.”