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AT&T, DirecTV announce $48 billion merger
By Cecilia Kang, Sunday, May 18, 5:16 PM E-mail the writer
AT&T and DirecTV on Sunday announced an approximately $48 billion merger that would create a new telecom and television behemoth to rival cable firms — while raising fresh concerns over competition and options for consumers.
AT&T would gain DirecTV’s 20 million U.S. subscribers, a company with strong cash flows and an ability to fatten its bundle of offerings. The combined firm would be able to offer phone, high-speed Internet and paid television subscriptions to more customers — packages only cable firms such as Comcast have been able to sell.
It is the latest mega-merger to be announced this year in a dramatically shifting telecommunications industry. The titans of the industry have recently rushed to bulk up — in overall size and in diversity of service offerings — as their legacy phone and television businesses fray and consumers turn to the Internet for communications and entertainment.
The deals, which must be approved by federal regulators, have prompted new concern that consumers could be left with fewer options and even higher prices after years of creeping increases in monthly bills. Last year, U.S. cable television prices increased 5.1 percent to an average $64, triple the rate of inflation, according to a government report.
“The industry needs more competition, not more mergers,” said John Bergmayer, a senior staff attorney at Public Knowledge, a nonprofit consumer advocacy group. “We’ll have to analyze this one carefully for potential harms both to the video programming and the wireless markets.”
After a failed attempt three years ago at buying wireless provider T-Mobile, AT&T had been searching for alternative acquisitions. But its choices were limited, with regulators expressing great concern that the wireless and high-speed-Internet markets were not competitive enough.
The Dallas-based company said it would gain broad strategic benefits from buying the nation’s second-largest paid-television provider. The phone giant would have greater power with television programmers to bring down licensing costs. And as the nation’s second-largest wireless carrier, it could use its new prominence in the television industry to bring videos to its mobile customers. El Segundo, Calif.-based DirecTV has an exclusive contracts with programmers, including NFL Sunday Ticket, which allows football fans to watch their favorite teams even if they live outside the local television markets serving the teams.
Originally Posted by Deberg_1990:
They never did full fiber to the home. Except in brand new neighborhoods. Posted via Mobile Device
Yep.
One of the things Verizon and others have gotten right. Nobody wants to just abandon millions of dollars of copper cable but sometimes you have to make hard decisions if you want to be part of the future. Google doesn't have an existing copper plant so they've got no barriers to going balls deep on pulling fiber to everywhere.
AT&T has fucked up on so many levels in the residential broadband arena. They could have used their $50B to strengthen their in-house media offerings or outright bought a media company. [Reply]
Originally Posted by dirk digler:
I have both an AT&T mobile phone and DTV and I have never had an issue with DTV service, can't say the same about AT&T.
Have you ever had a billing dispute with DTV? Cable companies are easier to deal with and that's saying something... [Reply]
Originally Posted by htismaqe:
Have you ever had a billing dispute with DTV? Cable companies are easier to deal with and that's saying something...
Nope but I have had other issues and they took care of them without any problems.
Where I work we use AT&T MPLS circuits and mobile phones and frankly there is nothing good to say about their service or products. Just horrible. [Reply]
Originally Posted by dirk digler:
Nope but I have had other issues and they took care of them without any problems.
Where I work we use AT&T MPLS circuits and frankly there is nothing good to say about their service or product. Just horrible.
Whenever I had technical issues with DirecTV, it was fine. The first time my bill was wrong, their true colors came out.
Or course, at least they don't outright lie like Dish Network tried to recently. Good thing I was able to remind them that my call was being recorded for quality purposes.
Honestly, the way both satellite companies do billing now is no different than the cable companies. It's all a big fucking scam. [Reply]
Originally Posted by htismaqe:
Actually, the speculation is that AT&T is out of resources on it's residential broadband network and looking to offload wireline customers to DirecTV in order to save bandwidth.
They tried to hedge their bets by using vDSL over copper and it failed.
DirecTV owns a shitload of spectrum. One of the funds in our portfolios has made a fuck load on his DirecTV position, and he explained it as not a play on the satellite business but as a play on spectrum. DirecTV was apparently very forward looking and has been buying up spectrum quietly for the last 8 or so years and owns a lot of unused spectrum. [Reply]
Honestly, the way both satellite companies do billing now is no different than the cable companies. It's all a big fucking scam.
That is probably true. I wish one of these TV prodviders would give in and start offering À la carte programming. I think they would be big winners if they were to do that. [Reply]
Originally Posted by dirk digler:
That is probably true. I wish one of these TV prodviders would give in and start offering À la carte programming. I think they would be big winners if they were to do that.
Originally Posted by RunKC:
Not sure if you guys heard, but AT&T took a shitload of Sprint customers this year. Sprint had a network problem so those people switched.
That's why sprint just released the "framily" advertising with great deals. They're getting desperate.
The better marketing is also due to Softbank's influence. Softbank has a great execution track record. [Reply]
Originally Posted by RunKC:
The problem with AT&T is that the right hand never knows what the left hand is doing. They have extremely poor communication internally.
That's kind of what I've thought for a while. They got so big so fast that they didn't develop any sort of unified forward motion in becoming a wholly good company. [Reply]
