Antitrust Enforcers’ Third “Listening Forum” On Merger Reform Highlights Issues In The Media and Entertainment

In March of this yr the Antitrust Division of the U.S. Division of Justice (“DOJ”) and the Federal Commerce Fee (“FTC”) collectively introduced a collection of “listening forums” that may assist collect actual world enter from contributors in key trade segments on potential reforms to the antitrust laws pertaining to mergers and acquisitions.Co-led by DOJ Deputy Assistant Legal professional Normal (“AAG”) Jonathan Kanter and FTC Chairperson Lina Khan, the third of the 4 introduced boards, specializing in media and leisure, was held on April 27, 2022.2 In addition to AAG Kanter and Chairperson Khan, this system included seven panelists that supplied views from entertainers, music, ticketing, journalism, and subsequent technology broadcast know-how.3

Chair Khan began her remarks by recognizing the large change within the trade for content material suppliers and the best way by which shoppers now entry that content material. Khan famous that in 2021 communications and media mergers had a deal worth of practically $200 billion, and she famous vertical integration as a part of a few of these mergers. Khan additionally expressed issues about “bottleneck” conditions the place a handful of firms management upstream and downstream circulation of content material, adversely impacting competitors, variety of content material, and pricing. She indicated that the FTC is working to enhance the company’s analytical efforts to measure hurt particularly with respect to those new communications and media platforms and applied sciences. Newspapers, media, and leisure are the “lifeblood” of democracy based on Khan, and so it’s of the utmost significance to make it possible for competitors just isn’t adversely impacted by means of ongoing consolidation within the trade. 

The panelists expressed a variety of issues within the trade, such because the wave of consolidation within the trade and its antagonistic affect on variety of visible and music content material, wages, and various ticketing choices. The panelists additionally urged the businesses to reject behavioral cures in alternate for merger clearances, further scrutiny for hedge fund acquisitions of newspapers, and trade pressures to restrict various broadcast distribution platform know-how choices.

AAG Kanter supplied closing marks by recognizing that consolidation within the media and leisure trade decreases programming and results in the “silencing of voices.” Kanter additionally famous the problems within the labor market and the necessity for the antitrust businesses to deal with these points when revising the framework for the horizontal merger pointers.
The discussion board ended with some public feedback, most of which echoed related issues raised by the panelists, with further complaints about non-public fairness acquisitions within the trade and vertical integration within the music trade.

With AAG Kanter just lately stating that he’s “here to declare that the era of lax enforcement is over, and the new era of vigorous and effective antitrust law enforcement has begun,” it’s important, now greater than ever, for media and leisure firms to companion with antitrust counsel to strategically analyze potential transactions within the trade, no matter dimension of transaction, in mild of such scrutiny. The FTC and DOJ are each prepared to check their enforcement mandate from the Biden Administration on this sector. And the Polsinelli Antitrust Workforce is able to help shoppers.

The last DOJ and FTC Listening Discussion board, on the subject of Expertise, which shall be held on Might 12, 2022. Click here to download the alert. 


FOOTNOTES

1    “Forums to focus on markets commonly impacted by mergers: food and agriculture, health care, media and entertainment, and technology,” March 17, 2022, obtainable at: https://www.ftc.gov/news-events/news/press-releases/2022/03/ftc-justice-department-launch-listening-forums-firsthand-effects-mergers-acquisitions

2    See “Antitrust Enforcers’ First ‘Listening Forum’ On Merger Reform Highlights Ongoing Concerns in the Food and Agriculture Industry” Might 9, 2022, and “Antitrust Enforcers’ Second ‘Listening Forum’ On Merger Reform Highlights Ongoing Concerns in the Healthcare Industry,” obtainable at: https://www.polsinelli.com/intelligence/antitrust-forum-highlights-concerns-in-food-and-ag and https://www.polsinelli.com/intelligence/antitrust-forum-highlights-healthcare-industry

3    Bio of the panelists obtainable at: https://www.ftc.gov/system/files/ftc_gov/pdf/Speaker%20Bios%20-%20April%2027%2C%202022.pdf

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