The sheer size of the deal - $120 billion - suggests Australia's media companies are too small to compete. They're done for.

It also suggests our telcos are going to be squashed unless they invest heavily in media. But actually this deal is not a harbinger of what is to come in Australia.

Our telcos already know content is king. Look at how much Telstra spends on AFL rights or Optus on Premier League.

First, AT&T is buying a company that creates content and owns the copyright on that content.

No comparison

There are no comparable content makers in Australia, according to managing director of Fusion Strategy, Steve Allen.

Local production companies make many many shows, but "programs don't get up here unless they are backed by a network," he explains.

And those networks own the copyright, at least for the first few years.

Second, most Australians still watch free to air television, despite what teenagers claim. The US has a much stronger culture of pay TV, whereas millions of us happily watch Ten, Nine, Seven, ABC and SBS and all their whacky secondary stations for free.

If you think a telco should buy a broadcaster, well our telecommunications companies are free to buy any commercial broadcaster they like without any competition or ownership problems.

They can also sign up as many online content deals as they like. Media reform isn't necessary.

Copying Telstra?

But AT&T is buying content streamed over the fixed internet cables it owns.

The only comparisons for streaming are Foxtel - already 50 per cent owned by Telstra - Netflix and Stan. (I doubt Netflix is up for sale to an Australian telco)

In one sense, AT&T is copying Telstra, which uses its stake in Foxtel to offer bundled deals.

Third, AT&T's benefit in this deal comes from owning infrastructure. But in Australia, the government-owned NBN Co will own the majority of our broadband infrastructure in coming years. So there is no chance of the infrastructure owner also owning the key to the video cupboard.

So while this deal is exciting and has lots of staggering numbers, it doesn't have any obvious parallels in Australia.

American angles

However, it does throw up all sorts of problems in the US. For example, once AT&T owns the copyright of everything produced by HBO, will it crack down on piracy? After all, it will now be able to see when customers are visiting Torrentz or Pirate Bay.

"I don't believe the US currently has as big a problem with piracy as it used to have," telco consultant John Lindsay says.

He used to be chief technology officer at iiNet, which famously fought against attempts by copyright owners to force iiNet to send pirating customers warning letters.

But downloading a bad copy of a movie makes less sense now that streaming is cheap and easy, Lindsay adds.

The big problem for consumers in the US will be whether they can access Time Warner's content without being an AT&T customer. Can they get CNN on their phone if they are a T-Mobile customer?

Whenever Netflix is slow US consumers suspect it's being throttled by their content-owning broadband provider.

Here, we just suspect rain got into the copper wires again.

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