Advanced Television

DirecTV, AT&T merger timetable emerges

October 10, 2014

The general consensus in the US seems to be that the proposed merger between DBS pay-TV operator and giant telco AT&T will get Federal Communications Commission (FCC) approval. The FCC has now closed its period for the general public and interested parties to make their comments heard. The FCC will reply to those comments on October 16th.

The USA Department of Justice must also make a decision as to whether the merger is in the public interest, and would not damage choice.

AT&T has bid $48.5 billion in a mix of cash and stock for DirecTV, and would also assume DirecTV’s debt pile of some $18.6 billion.

AT&T says it has no wish to stifle competition, quite the opposite. AT&T says it wants to expand DirecTV’s existing (overall) subscriber base of 38 million subs, which dwarfs AT&T’s own subs base of 5.5 million video clients.  Seen as key to the strategy behind the merger is winning access to DirecTV’s portfolio of sports rights, not least the NFL, which AT&T wants to stream to its client’s tablets and smart-phones. DirecTV has just struck a deal with the NFL covering the next 8-years of exclusive TV rights, and lasting for 8 years.

Inevitably there will be compromises forced on the two players by the FCC and DoJ, and AT&T has already moved to suggest it would boost ‘super-fast’ broadband to a wider number of US major cities. Dallas has already been served with 1 gigabyte/second downloads by AT&T.

Current thinking is that the FCC and DoJ approval could be in place by April 2015. The FCC usually acts within a 180-day period, and one month of that timetable has now elapsed.

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