Regulatory OK prospects for T-Mobile buying Sprint seem “relatively dim” even with Assistant Attorney General Makan Delrahim’s recent comments that there’s no magic number of carriers (see 1806050018), MoffettNathanson analysts said Thursday. Odds remain fifty-fifty, with the deal’s Herfindahl-Hirschman Index measure of market concentration playing an important role, they said. It’s “partially true” the companies together make a stronger competitor to AT&T and Verizon, but “counter-arguments are just as compelling,” including the industry’s high HHI and concerns about foreign investment, spectrum ownership and the wholesale market, they said. DOJ may be reviewing how Sprint/T-Mobile may affect prices of smaller wireless companies that buy wholesale access from the carriers, Reuters reported Thursday.

The U.K. signed off on either Comcast or Fox buying Sky, though the latter deal would come with a Sky News spinoff. U.K. Secretary of State-Digital, Culture, Media Matt Hancock said Tuesday Comcast/Sky "does not raise public interest concerns" and the government wouldn't intervene. He agreed with the Competition and Markets Authority that Fox/Sky likely wouldn't go against public interest on grounds of hewing to broadcasting standards but said CMA took "a clear and logical approach" when it said such a deal raises concerns about Sky News' editorial independence and about increased Murdoch Family Trust sway over public opinion and U.K. politics. He said the CMA proposal of Sky News being sold to Disney or another suitable buyer, with an agreement ensuring its funding for at least 10 years, "is likely to be the most proportionate and effective remedy for the public interest concerns." He said his staff will start talks with the parties to finalize details for an acceptable Sky News divestiture remedy. "I am optimistic that we can achieve this goal, not least given the willingness 21st Century Fox has shown in developing these credible proposals," he said, saying if the parties can't come to terms, blocking a Fox/Sky deal might be the only fallback. Comcast in April made a formal bid for Sky, while Fox had a pending bid (see 1804250026), and Sky subsequently said it favored the Comcast offer (see 1804260008). Sky Tuesday said its board members are "mindful of their fiduciary duties and remain focused on maximising value for Sky shareholders." Disney "welcome[d] today’s announcement from the Secretary of State and [is] ready to engage in any discussions requested by the Secretary of State.” Fox expects to reach a final decision with the U.K. Department for Culture, Media and Sport that clears the transaction.

Recent FCC and DOJ commentary "bodes well" for regulatory OK of T-Mobile buying Sprint, with more clarity coming soon, Macquarie Research wrote investors Tuesday. After a speech last week, Assistant Attorney General Makan Delrahim reportedly told journalists he sees no magic number of carriers for the wireless market, and FCC Chairman Ajit Pai earlier indicated he would "keep an open mind on wireless consolidation," the analysts said. The market is "clearly competitive," the analysts said, with Comcast adding 577,000 Xfinity mobile subscribers in about 10 months, Charter Communications slated to launch wireless service in 2018 and Altice and Cox doing likewise in 2019. The American Antitrust Institute said T-Mobile/Sprint should be dead on arrival at the Justice Department because it would create an oligopoly. It “would further reduce the number of rivals from four to three, stoking even higher concentration in the national U.S. wireless market and contributing to growing concerns over a broader systemic decline in competition, market entry, and equality in the U.S. economy,” AAI said Tuesday. An AT&T executive last week said the carrier is unlikely to oppose the combination (see 1805300037). T-Mobile didn't comment.

Corning’s $900 million buy of 3M’s optical-fiber business (see 1801250017) is “largely” complete, said Corning Monday. It expects to close the sale of the remaining “telecommunications system integration services” business later in 2018, subject to “customary closing conditions and regulatory approvals,” it said. Corning’s Optical Communications sector will acquire about $400 million in annual sales of high-bandwidth and optical-fiber products from 3M, said Corning’s mid-December announcement. The acquisition also extends Corning’s optical-fiber market reach and access to global customers, especially in “key growth areas” outside North America, said the company.

Content company Lionsgate bought majority ownership of production company 3 Arts Entertainment, they said Wednesday. They said 3 Arts -- responsible for such TV series as 30 Rock, It's Always Sunny in Philadelphia, Brooklyn Nine-Nine and American Vandal -- will continue to operate under the direction of its partners.

Content companies oppose a proposal by RCN and the American Cable Association for conditions on court approval of AT&T's proposed buy of Time Warner. In docket 17-cv-02511-RJL Tuesday in U.S. District Court for the District of Columbia, CBS, Disney, 21st Century Fox, Univision and Viacom filed a motion (in Pacer) to intervene or for leave to file an amici curiae brief in support of neither part. The content companies said they want to oppose the RCN/ACA proposal (see 1805150002) because of it requirement that rival MVPDs trying to arbitrate a dispute over access to New AT&T programming give New AT&T rates and terms agreements for content from other programmers. That proposed condition would give New AT&T access to the content companies' competitively sensitive agreements "despite the fact they are not at issue in and are unrelated to the harms complained of" by RCN and ACA, the content companies said. In a statement, ACA said there's no evidence similar commercial arbitration terms that DOJ and the FCC have used in the past have hurt programmers. "Just as the court rejected their earlier effort to deny access to this key information as evidence in the DOJ's case against AT&T/Time Warner, it should do so again here. Failure to do so would cut the heart out of the arbitration process by so limiting the information that it is discoverable that no party would utilize it. Neutering the arbitration process may serve the private interests of these programmers, but not the public interest." Judge Richard Leon expects a decision June 12 (see 1804300020).

The parent of CBS and Viacom struck back at the broadcaster, challenging in court the TV network's plan (see 1805180054) to, in the investor's words, "unilaterally dilute the voting rights of its controlling stockholder." The CBS board's plan is "unprecedented under Delaware law," violates the broadcaster's bylaws and charter, was based on the recommendation of a special committee with five directors "acting far beyond its authority" and breaks the board's fiduciary duties. So said National Amusements Inc. Tuesday in Delaware Chancery Court, which NAI said has jurisdiction over the dispute. The investor affiliated with Redstone family members like CBS Chairman Emeritus Sumner Redstone and current Vice Chair Shari Redstone said the TV company's contentions NAI wanted to "cram down a CBS/Viacom merger" is false. NAI's "reactive complaint" comes after CBS and its special committee detailed how "NAI misused its power to the detriment of CBS shareholders," the broadcaster said. "We continue to believe firmly in our position.”

Comcast/Fox likely has an easier route to antitrust approval than Disney/Fox, New Street Research said in a note to investors Tuesday. The analysts said both potential deals raise horizontal issues because Comcast and Disney have programming assets, but the Disney deal is potentially riskier due to the theatrical release market. They said there could be a Clayton Act problem with the Murdoch family having control of Fox's broadcast assets while also significant interest in or even a board seat on an entity that controls ABC. That Disney isn't an ISP or MVPD makes Disney/Fox less a vertical issue, but DOJ generally doesn't challenge vertical deals anyway, and Comcast/Fox likely doesn't raise big vertical red flags since Comcast doesn't have a national footprint, wrote the analysts. Neither deal seemingly will require FCC approval, they said, noting Disney/Fox could face smoother sailing politically due to Trump administration antipathy to Comcast/NBCUniversal. New Street said a DOJ loss in its bid to block AT&T's buy of Time Warner helps both Disney and Comcast, but Comcast especially since DOJ will be particularly timid about opposing similar vertical deals, while a Justice win would hurt Comcast more because the agency might see it as a judicial mandate to bring more such suits. Others see Comcast/Fox having a likely easier time getting government approval (see 1805240034).

The Senate Judiciary Antitrust Subcommittee's June 27 hearing on T-Mobile's proposed merger with Sprint (see 1805230006) will begin at 2:30 p.m. in 226 Dirksen, an aide to Chairman Mike Lee, R-Utah, told us.

CBS amended its lawsuit against controlling shareholder National Amusements Inc. to include the CBS board’s vote to dilute NAI’s stock and NAI’s amendment of the rules governing the board (see 1805180054), said an amended complaint filed at the Delaware Court of Chancery Wednesday. NAI head Shari Redstone “threatened to impose her and NAI’s will on the Company at the expense of all of the Company’s stockholders,” CBS said. The amended complaint urges the court to affirm the vote to dilute NAI’s shares and declare as invalid NAI’s amendments to bylaws to stop that dilution. CBS is also seeking an injunction preventing NAI, Redstone and affiliated parties from trying to interfere with the composition of the CBS board.