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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 teedubya:
"technically" Cingular and Southwestern Bell bought DirecTV. SWB acquired AT&T in 2005. After this acquisition, SBC took on AT&T's name and branding, and this is the company known as AT&T today.
"Technically" having one company have too much power to control a market is why they were broken up in the first place.
And history shows that every single person in America alive at the time and every person since has benefited from ATT being broke up. [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.
A la carte is great in theory but especially as sports fans you do not want it all. The cost would end up being a lot more than what we currently pay. [Reply]
Originally Posted by BigRedChief:
"Technically" having one company have too much power to control a market is why they were broken up in the first place.
And history shows that every single person in America alive at the time and every person since has benefited from ATT being broke up.
And yet essentially they have merged and acquired to get back to their pre baby bell days. Sad. [Reply]
Originally Posted by htismaqe:
We have a rural telephone cooperative here. I live like a mile from the closet town, population 599. The phone company has 1700 subs and they've pulled fiber to every house in 3 three exchanges they serve.
I have 30Mbit ethernet right into my house. My SOHO router is connected directly to the network. No modem, no service provider router, nothing.
They're funded by the customer members (and the Federal Universal Service Fund but that's a topic for another day). There's absolutely no competition in these 3 little towns yet we're years ahead of many cities on the coasts.
Our local coop did the same expect they didn't take federal funds. They basically said screw it the government we will get a loan and do it ourselves. Its crazy our rural counties will have better internet than many of the large cities. Should be an economic boom for our area. [Reply]
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.
ATT handled it a lot better than Verizon did. They've got a much bigger footprint for Uverse and already have a lot of infrastructure in place to do a fast FTTH rollout if they want to.
Originally Posted by htismaqe:
We have a rural telephone cooperative here. I live like a mile from the closet town, population 599. The phone company has 1700 subs and they've pulled fiber to every house in 3 three exchanges they serve.
I have 30Mbit ethernet right into my house. My SOHO router is connected directly to the network. No modem, no service provider router, nothing.
They're funded by the customer members (and the Federal Universal Service Fund but that's a topic for another day). There's absolutely no competition in these 3 little towns yet we're years ahead of many cities on the coasts.
I work for a telco coop. We have exchanges with less than 1000 subs that have fiber to the home and have better services than my folks living in a city of 165,000 people. [Reply]
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 ****ed 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.
Yep. Before my mom left TW. All the millions they spent in KC upgrading to fiber in the early 2000s paid for themselves years ago. Pure profit almost from them on the internet which is where everything is going as they are charges fees for everything else.
It is going to keep getting worse as citizens will not stand up for themselves.
Kind of like the shit KC water and sewer. My bill gets a 20 to 30 monthly charge/fee that they will not take off for upgrades. That is free money for them. As they are not upgrading shit in the city. [Reply]
direct tv has always been top fucking notch when it comes to customer service here. I have not had one bad complaint to say about their CS andi have been with DTV since 1998. Always hook me up with free upgrades <3 my Genie. [Reply]
I've had Uverse for a bout 5 years, and have no complaints.
had DTV for a while, but only for ST; but canceled it because I primarily watch NCAA football anymore. [Reply]
Originally Posted by BryanBusby:
ATT handled it a lot better than Verizon did. They've got a much bigger footprint for Uverse and already have a lot of infrastructure in place to do a fast FTTH rollout if they want to.
Originally Posted by rockymtnchief:
I work for a telco coop. We have exchanges with less than 1000 subs that have fiber to the home and have better services than my folks living in a city of 165,000 people.
There was a big stink over it after Hurricane Sandy when they refused to replace the trashed copper or roll out fiber optic lines to heavily hit areas. [Reply]
