By Alan Murray and Claire Zillman
June 13, 2018

Good morning.

Judge Richard Leon’s decision on the AT&T–Time Warner merger was destined to be one of the most important antitrust decisions in years, whichever way he ruled.

Had Leon ruled in favor of the government and blocked the merger, it would have signaled a new age in antitrust enforcement, calling into question other “vertical” mergers like CVS–Aetna, and possibly even creating an argument that could be used to go after vertically integrated companies like Google or Amazon.

By ruling unequivocally against the government, however, Leon not only cleared the way for the AT&T–Time Warner merger, but also for the sale of 21st Century Fox assets to either Disney or Comcast. And the markets yesterday seemed to think the judge’s decision improved prospects for Sprint and T-Mobile to merge—even though that’s a classic horizontal merger. At the core of such thinking is AT&T’s argument that in a world of tech giants like Google, Facebook, Amazon and Netflix, legacy companies need to merge in order to have any hope of competing.

The government hasn’t said whether it will appeal the ruling. But Judge Leon clearly discouraged any such action. And AT&T issued a statement saying they hoped to close the merger by June 20.

One question that lingered over the case was whether the government’s position was driven by the president’s antipathy to CNN, which is owned by Time Warner. Judge Leon never allowed that part of the case to move forward. But I suspect the president’s non-stop criticism of CNN will make it impossible for AT&T to make major changes at the network, for fear of being seen as bowing to White House pressure. CNN President Jeff Zucker, ironically, may have the president to thank for his continued employment.

More news below.

Alan Murray
@alansmurray
alan.murray@fortune.com

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