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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 Spott:
It really didn’t help matters that they already had Uverse and were in the process of building their fiber to the house network in the 21 states where they operate locally when they decided to acquire Directv. But then they acquired Warner, immediately stopped the existing build of the fiber to the curb which wasn’t even halfway done. On top of that, they started another streaming service (HBO Max) to go along with all of their other TV services (Directv, Directv streaming, Uverse and ATT TV now) which has to be really confusing to the customers.
Yep. That's just classic mismanagement. When you don't have a clear vision, you end up making a bunch of helter skelter moves like they did. [Reply]
Discovery Network purchased Scripps back in 2017. Scripps doesn't pay royalties on the music used for their TV shows, so I was hoping that Discovery Network would change that because Discovery pays well.
Unfortunately, my hope was displaced.
Back in late 2019, Discovery Network announced that they would no longer pay royalties for their TV shows and they had planned to re-do all of the music on their TV shows with an In-House catalog that was created and curated by Pat Weaver. When that was announced, Pat lost her shit and quit. The Production Music Association and its members (me included) became very vocal about losing royalties and Discovery backed off. Most people thought that it was because of the outside pressure but the real answer was that Discovery didn't want to lose a very public battle because they were asking everyone in town to purchase the network.
So, long story short, this has been in the works for at least 18 months that I'm aware of and while I'm slightly surprised that AT&T ended up purchasing Discovery, I think it will be great for HBO Max customers because at some point, there will be Discovery Network shows available for streaming, just like Disney and Nat Geo. Warner's has a great track record of paying royalties and treating composers like real people, so there's hope that this acquisition will be great for everyone.
Not exactly the best place for this but we recently dropped cable for Philo. It’s only $20 month for live TV with recording and all those things of all the basic cable channels. AT&T, satellite, cable, etc. simply can’t compete with that.
I was reading about how some states are taxing and putting fees on digital subscriptions just like they have on regular cable but seems Kansas isn’t there yet. [Reply]
I have Google fiber. It's the free version. I paid $300 for installation and it's free until May 2023. I'm wondering what will happen after that. [Reply]
Originally Posted by htismaqe:
Yep. That's just classic mismanagement. When you don't have a clear vision, you end up making a bunch of helter skelter moves like they did.
For his mismanagement, he left with millions in the bank and a $274K per month pension. [Reply]
Originally Posted by oldman:
Fiber by itself is pretty cheap. The real cost is in the electronics and right of way issues. With 5G, you're going to see a lot of wireless last mile stuff. I live in the country with only satellite and dial-up internet available. We couldn't even get reliable cell service until about 3 months ago when they placed a new tower about a mile from our house. Now I'm getting mailers and email from wireless ISPs.
My part of the country we have high speed internet and cable via our electric co-op. They brought fiber through their electric pole network that they already own. They are making a fortune bringing it to other co-ops through out the state and country. [Reply]
Originally Posted by htismaqe:
It depends on the expertise and education required for the job.
It's not always cheaper but by and large, it holds true across the tech industry. I've hired a lot of people and when you consider 3-4% over 15 years vs. a college grad, it's a huge difference. Plus, I only have to pay them for 2 weeks of vacation while a 15-year vet has 5-6 weeks they can accrue.
A lot of companies I've seen only give long term people cost of living adjustments and get fucked when they have to pay more to replace the person tired of CoL adjustments that left for more money.
PTO not a big deal. They will just crack the whip on the other workers to compensate while Tom is out.
On a side note, I think the market is starting to get white hot. A lot more chatter from recruiters lately. [Reply]
Originally Posted by ChiefsCountry:
My part of the country we have high speed internet and cable via our electric co-op. They brought fiber through their electric pole network that they already own. They are making a fortune bringing it to other co-ops through out the state and country.
We have FTTH from our telephone coop. They trenched fiber all over, even in the country. Since it's a coop, we (the stakeholders) essentially paid for it, so it's a win-win. [Reply]
Originally Posted by BryanBusby:
A lot of companies I've seen only give long term people cost of living adjustments and get fucked when they have to pay more to replace the person tired of CoL adjustments that left for more money.
PTO not a big deal. They will just crack the whip on the other workers to compensate while Tom is out.
On a side note, I think the market is starting to get white hot. A lot more chatter from recruiters lately.
In the hiring's I've been involved in, those COL increases are worth more than a kid fresh out of college. I've never seen a new hire be MORE than a tenured employee, unless that employee has only been with the company a few years.
Of course, I'm often dealing with people with 15-20 years of experience or more. Those people tend to be expensive comparatively, even if they've only been getting COL raises recently. [Reply]
Originally Posted by htismaqe:
We have FTTH from our telephone coop. They trenched fiber all over, even in the country. Since it's a coop, we (the stakeholders) essentially paid for it, so it's a win-win.
Originally Posted by htismaqe:
We have FTTH from our telephone coop. They trenched fiber all over, even in the country. Since it's a coop, we (the stakeholders) essentially paid for it, so it's a win-win.
Yep. I have fiber in front of my property and my closest neighbor is a 1/4 of a mile away. [Reply]
Originally Posted by htismaqe:
I live a mile from a town of 600 people and the telco as a whole only has a couple thousand customers. Pretty fortunate honestly.
I know, I live 5 miles out with a similar customer base for the local Telco. Iowa had some nice grants for rural fiber as well. [Reply]
Originally Posted by IowaHawkeyeChief:
I know, I live 5 miles out with a similar customer base for the local Telco. Iowa had some nice grants for rural fiber as well.
It's because Iowa has more independent telephone companies than any state other than North Carolina. I used to work for Iowa Network Services equal access (25 years ago now). :-) [Reply]
