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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 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.
what happened to that $500 odd million they took from the government a while back that was supposed to enhance and upgrade their whole infrastructure? I call bullshit on them maxing out their resources. [Reply]
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 fucking idiots made a play on 4G without the LTE network. I can't remember what they called it, but they bought a pacific NW company and used their network to roll out 4G first. And it was a fucking disaster. So they've had to play catch up to the others, and their network is shit because of it. Happiest day of my life was dumping Sprint after almost a decade of service. [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.
Originally Posted by Discuss Thrower:
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.
They were always big. And they grew through acquisition, like pretty much any company in their position.
Their situation isn't wholly unique, unfortunately. [Reply]
Originally Posted by Mr. Flopnuts:
The fucking idiots made a play on 4G without the LTE network. I can't remember what they called it, but they bought a pacific NW company and used their network to roll out 4G first. And it was a fucking disaster. So they've had to play catch up to the others, and their network is shit because of it. Happiest day of my life was dumping Sprint after almost a decade of service.
AT&T made a fairly significant investment in HSPA+, if that's what you're talking about. [Reply]
Originally Posted by Mr. Flopnuts:
The fucking idiots made a play on 4G without the LTE network. I can't remember what they called it, but they bought a pacific NW company and used their network to roll out 4G first. And it was a fucking disaster. So they've had to play catch up to the others, and their network is shit because of it. Happiest day of my life was dumping Sprint after almost a decade of service.
To be fair, the standard setters for 4G changed the standards. Sprint went all in on their WiMax network which wasn't LTE. The standard setters then said the phone companies said they only had to significantly improve speeds to call themselves 4G (I believe as long as they doubled it, it was good to be 4G). [Reply]
Originally Posted by milkman:
I have no idea what any of this means.
Having some insight into the telecomm field, I think what Htis said was that ATT bought DirecTV to shift some customers who are using their data lines for both Internet and TV in order to shift part of the load (the television part) onto DTV's existing service.
And I'm guessing vDSL means virtual Digital Subscriber Line over copper networking, which means it's already at a disadvantage compared to fiber optic cables. [Reply]
Originally Posted by Discuss Thrower:
Having some insight into the telecomm field, I think what Htis said was that ATT bought DirecTV to shift some customers who are using their data lines for both Internet and TV in order to shift part of the load (the television part) onto DTV's existing service.
And I'm guessing vDSL means virtual Digital Subscriber Line over copper networking, which means it's already at a disadvantage compared to fiber optic cables.
Originally Posted by notorious:
I must be lucky, because they throw me freebies every time I call in.
The thing that pisses me off with DTV the most is that if I'm having issues they always want to walk me through a reset and I'm like,"look I get you're just doing your job but I've had your service for 17 years and I know what a reset is and I've already tried that and that's not the issue!" [Reply]
Originally Posted by Nzoner:
The thing that pisses me off with DTV the most is that if I'm having issues they always want to walk me through a reset and I'm like,"look I get you're just doing your job but I've had your service for 17 years and I know what a reset is and I've already tried that and that's not the issue!"
Yeah, that's tech companies in general.
I just spent the last 5 weeks going through similar bullshit with Netgear on one of their new AC1900 home routers.
I'm sending them fucking packet captures and they're asking me if I set my wireless channel to 6. [Reply]
Originally Posted by DaFace:
Ah, good. Media consolidation usually works out for consumers.
The thing is, it isn't media consolidation. It's media delivery consolidation. It's a real head scratcher honestly, even if they did it for the spectrum as Native suggested. [Reply]