AT&T, Time Warner execs address DOJ lawsuit

Thank you, Larry, and good evening. I do appreciate everybody coming on short notice. What you're going to hear in a moment are some comments from our legal team, but first I want to make just a few points. Obviously, we're surprised to be here and, candidly, I'm a bit troubled by it. Jeff Bewkes and I entered into this deal with really decades of clear legal precedent demonstrating how this merger would ultimately be evaluated. When we announced this deal, the best legal minds in the country agreed that this transaction would be approved since our companies don't even compete with each other. But here we are: the government has filed a lawsuit and it stretches the very reach of antitrust law beyond the breaking point, all of this in an effort to stop this combination. This comes at a time when the communications and media industries are undergoing some rather radical change. Massive, large-scale internet companies with market caps in the hundreds of billions of dollars are creating tons of original content and they're distributing it directly to the consumer. This is disrupting both industries—the media as well as the communications industry—and it's being done at a level and a pace that most of us could not have even conceived five years ago. For example, Netflix distributes their content to over 100 million customers. Amazon distributes its content to its Prime members, that's estimated to be in excess of 60 million. Google and Facebook reach and distribute content to literally billions of customers. And the government contends that AT&T, with 25 million TV customers, and Turner, with a single-digit share of all media watched, will have unlawful market power. This defies logic and it is unprecedented. I've done a lot of deals in my career, but I've never done one where we have disagreed with the Department of Justice so much on even the most basic of facts. But despite our disagreements, we have offered concrete and substantial solutions, and as we head to court, we will continue to offer solutions that will allow this transaction to close. It cannot be lost in the noise that combining these two companies will create significant and tangible consumer benefits, and every day we spend litigating this deal is a day we're wasting in bringing those benefits to the customers. We do not intend to settle this matter out of simple expediency because the rule of law is at issue here. Consistency in the application of the law is critical in a free-market economy, and it's equally important for preserving confidence in our government—confidence that they will fairly adjudicate the matters brought before them. When the government suddenly and without notice or any due process discards decades of legal precedent, businesses large and small are left with no guideposts. Every business combination or significant investment becomes subject to the whim of a regulator, as we're seeing here. That tends to be a roll of the dice. We have no intention of proposing a solution that is beyond what the rule of law would require, and if there are legitimate concerns, there are plenty of solutions within the precedent as well as within the DOJ's own guidelines. And we'll continue to prefer to propose those types of solutions to the government. So before I hand this over to the legal teams, I do want to address the elephant in the room here. There's been a lot of reporting and speculation about what this is all about, and frankly, I don't know. But nobody should be surprised that the question keeps coming up because we've witnessed such an abrupt change in the application of antitrust law here. But the bottom line is that we cannot and we will not be party to any agreement that would even give the perception of compromising the First Amendment protections of the press. So any agreement that results in us forfeiting control of CNN, whether directly or indirectly, is a non-starter. We believe quite strongly that any divestiture of AT&T assets or Time Warner assets is not required by the law, and we have no intention of backing down from the government's lawsuit. We are in this to win, and absent a reasonable compromise that doesn't violate our principles, we expect to do just that. So I turn it over to David.