Justice sues AT&T/DirecTV over collusion to pick up Dodgers RSN

Here’s a story that no one saw coming. The Justice Department is suing AT&T saying that its DirecTV satellite service led a campaign with big three other pay TV providers to prevent SportsNet LA from gaining wide carriage in Southern California. SportsNet LA has the rights to the Los Angeles Dodgers and since it began operation in 2014, has not been picked up by DirecTV and other major providers in the LA market.

The Los Angeles Times reports that DirecTV led a campaign to make sure three other companies, AT&T (which at the time did not own DirecTV), Cox Communications and Charter Communications would not take the channel as well. Since then, AT&T has purchased DirecTV and Charter has bought Time Warner Cable which was a partner in creating SportsNet LA.

DirecTV and Cox still do not offer the channel on their systems saying SportsNet LA is too expensive.

The lawsuit says DirecTV was the mastermind in trying to get the aforementioned three companies to conspire to prevent SportsNet LA from gaining wide access to subscribers..

“Dodgers fans were denied a fair competitive process when DirecTV orchestrated a series of information exchanges with direct competitors that ultimately made consumers less likely to be able to watch their hometown team,” Deputy Assistant Atty. Gen. Jonathan Sallet of the Justice Department’s antitrust division, said in a statement. “Competition, not collusion, best serves consumers and that is especially true when, as with pay-television providers, consumers have only a handful of choices in the marketplace.”

AT&T has responded with a statement of its own:

“The reason why no other major TV provider chose to carry this content was that no one wanted to force all of their customers to pay the inflated prices that Time Warner Cable was demanding for a channel devoted solely to L.A. Dodgers baseball. We make our carriage decisions independently, legally and only after thorough negotiations with the content owner. We look forward to presenting these facts in court.”

The timing of the lawsuit comes right after AT&T announced its plans to buy Time Warner (which sold Time Warner Cable back in 2009). Various federal agencies will look into the merger to see if there are any anti-trust concerns. One wonders if this will force AT&T/DirexTV to pick up SportsNet LA (now rebranded to Spectrum SportsNet this year following Charter’s purchase of Time Warner Cable) and eventually lead to the feds signing off on the deal.

[Los Angeles Times.                                                                                                  ]