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AT&T Businesses Television News Entertainment

AT&T Buying DirecTV for $48.5 Billion 173

Posted by Soulskill
from the go-big-or-go-home dept.
AT&T is acquiring satellite TV provider DirecTV in a deal worth $48.5 billion. This will bring 20 million more U.S. television subscribers under AT&T's roof, making it the second biggest TV provider, behind Comcast. The deal is subject to regulatory approval, and to help that along, AT&T says it will sell its 8% stake in America Movil, which is a competitor to DirecTV in some areas. "By acquiring the country’s biggest satellite television operator, AT&T will help bolster its competitive position against Comcast. Though pay television is considered a mature market whose subscriber growth has slowed dramatically in recent years, the business nonetheless generates billions of dollars in cash. ... Part of the attraction may be DirecTV’s ample cash flow. While its business has shown little growth in recent years, it generated about $8 billion in earnings last year. Much of that will go toward future investments in growth, AT&T said, including bidding at least $9 billion for wireless network capacity that the government plans to auction off soon. By gaining satellite TV, AT&T may also be able to free up capacity on its existing broadband network."
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AT&T Buying DirecTV for $48.5 Billion

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  • by Anonymous Coward on Sunday May 18, 2014 @07:12PM (#47034471)

    AT&T can't be allowed to get any bigger than it is now. They had to break it up once already.

    • Re: (Score:3, Interesting)

      by symbolset (646467) *
      AT&T charges their broadband customers $30/month++ to opt out of traffic monitoring for ad targeting.
    • by hackus (159037) on Sunday May 18, 2014 @08:40PM (#47034925) Homepage

      Possibly the worst news since the TimeWarner merger crapola.

      You think your DirectTV PVR can't download your movies now?

      Wait till they start using the CRUD that is AT&T's network.

      Absolutely unacceptable.

      The reason why they are doing the acquisition is because Uverse sucks to HIGH HEAVEN. It is even worse than DirectTV, if you can imagine that.

      • by mordenkhai (1167617) on Monday May 19, 2014 @02:03AM (#47036081)
        I have had the opposite experience. Had DirecTV for 2 years, took them months to figure out why the HD channels had issues. Finally after I missed the last minute of a series finale for a personal favorite show I called and finally got someone who asked me to check satellite #2 signal, I didn't know there was a Satellite #2. The guy said "Yeah it is the HD feed". Sure enough, the dish hadn't been installed correctly. They came out and fixed it, but it was too late. As soon as my contract was up I left and tried Uverse, been good. Did a stint with Comcast as they entered the area with XFinity, and had a 50% off deal. After that, I am back at Uverse with no plans to leave.
      • by Lumpy (12016)

        Uverse sucks because AT&T has not had any engineers that know ANYTHING about Fiber or Internet for 2 decades.

        Uverse should have been 100% IP and they should have delivered 100Mbps to every home over fiber to the house and then a single CAT-5 into the home. Then their TV could have been IPTV on set top boxes and everything would have worked decently.

        But no, they wanted to use their special crap, that stayed as crap and actually got crappier.

        This is why I really hope a company that is semi competent star

        • by pnutjam (523990)
          The whole point of uverse was to avoid dropping new line to every home in a block. You upgrade the nearest termination point to fibre and push everything through copper. Bonus, you don't have to allow anyone onto your new fiber connected site.
      • My experience with DirecTv has been fine. I have been a customer for 4 years now and only lose the signal when its absolutely down pouring outside. After your two year contract is up, call them back and ask for a discount for another year commitment and you get $20 off per month. I have done that twice now. I hope that discount doesn't go away, but with AT&T, I have a feeling they will clamp down on all the super secret best friends discounts available from DirecTv Maybe its because i have newer eq
        • by pnutjam (523990)
          If uverse is any example. You will still get plenty of discounts. It's impossible to compare costs because everyone is on a special. You can even lock in most of the special prices through the website, without a phone call.
    • by ShanghaiBill (739463) on Sunday May 18, 2014 @09:14PM (#47035083)

      AT&T can't be allowed to get any bigger than it is now. They had to break it up once already.

      The AT&T broken up in 1983 was a different company. The current company called AT&T used to be Southwestern Bell. It acquired the rights to the name "AT&T" in 2005.

       

      • by Anonymous Coward

        It acquired AT&T's Cellular and Long Distance businesses as part of the deal, so really it was just reintegrating AT&T assets with SBC. Calling the new entity AT&T isn't entirely incorrect, since both were divisions of Ma Bell before the breakup.

      • by ArhcAngel (247594) on Sunday May 18, 2014 @09:52PM (#47035265)
        SBC (formerly known as Southwestern Bell Corporation) acquired the rights by buying the original AT&T in 2005 for 16 billion [cnn.com] so it's still part of the same company. SBC had already swallowed up numerous other baby bells prior [wikipedia.org] to acquiring AT&T.
      • by sjames (1099)

        Remember in T2 when they shattered the liquid metal terminator and all the pieces slowly pooled back together?

        AT&T has been doing that ever since the breakup.

    • You are right. Bigs means monopoly, monopoly means higher prices and you have to pay big bucks to get the service. They shouldn't allow that. Flash (http://www.flashinfo.ma)
    • Surely, if they are willing to pay 48 billion they would pay 100 billion.

  • by Anonymous Coward

    Now, take that AT&T from its shareholders and just liquidate it. Disgusting.

  • by Impy the Impiuos Imp (442658) on Sunday May 18, 2014 @07:21PM (#47034549) Journal

    They are the last real competitor to terrestrial cable tv. And the only one whose DVR was bright enough to back up 10s when you fastforwarded through a commercial and released when you saw the show start whizzin' by.

    • They are the last real competitor to terrestrial cable tv.

      My thoughts as well. Not to mention they have inside track on NFL Sunday Ticket. Since AT&T has the wireless broadband infrastructure and also DSL, they are the only company that will be able to keep Comcast/TWC in check.

      • Re: (Score:3, Insightful)

        by Anonymous Coward

        Since AT&T has the wireless broadband infrastructure and also DSL, they are the only company that will be able to keep Comcast/TWC in check.

        +1 Funny.

    • Uhh... AT&T's DVR is equally as bright.
  • Well. (Score:5, Insightful)

    by Anonymous Coward on Sunday May 18, 2014 @07:25PM (#47034559)

    We know where all the money they should be using on upgrading their network is going.

    • This is what they mean when they say they can't be common carriers, it will cut their ability to "upgrade infrastructure". I'm not following how Merger-fest 2014 is somehow giving consumers more choice, however.
  • $48.5 billion? (Score:5, Insightful)

    by PPalmgren (1009823) on Sunday May 18, 2014 @07:32PM (#47034593)

    If you spent HALF that on your network you'd crush your competition! What a crock of shit.

    • Re: (Score:1, Insightful)

      by Charliemopps (1157495)

      If you spent HALF that on your network you'd crush your competition! What a crock of shit.

      Again with the "I know how to run a billion dollar business!" nonsense. You've no idea what you're talking about.

      If they spent 24 billion on their network, what could they do at best? Their entire revenue from residential customers is $5.7 billion. http://about.att.com/story/att... [att.com]
      even if they'd have to increase their customers by 500% just to get revenue close to that kind of money. That's not even including all the added cost to support it. Residential broadband is not profitable. No one wants to expand i

      • Re:$48.5 billion? (Score:5, Informative)

        by Bengie (1121981) on Sunday May 18, 2014 @08:22PM (#47034821)
        First off, that $5.7b is for the first quarter, you know, 3 months. Second, that only applies to the 11.3mil Uverse customers. How many industries can get $166/month average per customer?
      • by mysidia (191772)

        If they spent 24 billion on their network, what could they do at best? Their entire revenue from residential customers is $5.7 billion.

        You mean their ANNUAL revenue right now from residential customers is $5.7 billion. If they spent 24 billion on upgrading and adding infrastructure their network, they would earn it within a few years, ignoring that their revenue will grow with a larger network.

      • by Lumpy (12016)

        If you think their CEO knows how to run a billion dollar business, then I chuckle at your naivety.

      • by pnutjam (523990)
        "Yeah, let's amortize our network investment over 1 year instead of the 10 to 20 it will be good for. That will trick people into thinking they need to cut us a break."
        -some ATT stooge
    • Re:$48.5 billion? (Score:5, Insightful)

      by tysonedwards (969693) on Sunday May 18, 2014 @07:54PM (#47034689)
      Not that it really matters, but the majority of the deal is in stock...
      Also known as "we now own you, and in exchange your stockholders now hold a smaller portion of our stock instead!

      Only 30% of the deal is in cash, making it 14.5 Billion changing hands. Still a big number, but not as bad as it sounds.

      As such, it actually comes out a touch cheaper than the cost that DirecTV spent on their satellites in the first place, and AT&T gets to exploit the 16% profit margin on DirecTV's lines of service.
      • Re:$48.5 billion? (Score:5, Insightful)

        by nabsltd (1313397) on Sunday May 18, 2014 @08:23PM (#47034827)

        As such, it actually comes out a touch cheaper than the cost that DirecTV spent on their satellites in the first place, and AT&T gets to exploit the 16% profit margin on DirecTV's lines of service.

        And, it basically kills off any chance for improvement of DirecTV technologies:

        While its business has shown little growth in recent years, it generated about $8 billion in earnings last year. Much of that will go toward future investments in growth, AT&T said, including bidding at least $9 billion for wireless network capacity that the government plans to auction off soon.

        Basically, AT&T is going to cannibalize DirecTV by taking all the money from DirecTV to use on cell phone spectrum. So, no money for new satellites, improved encoding hardware, more servers for download of on demand, etc.

        I've been a DirecTV subscriber since 1999, and if this merger goes through, I'll have to start looking for some other provider. It might even make me cut the cord.

        • by PRMan (959735)
          I love DirecTV but have a lifetime ban on AT&T. As soon as this goes through (actually a month earlier), I will officially be a cord cutter. And that's because my other choice will be switching to Comcast.
    • If you aired ALF on your network you'd crush your competition! Or you'd be craving cat.
  • Nooooooooo!!! (Score:4, Insightful)

    by opkool (231966) on Sunday May 18, 2014 @08:02PM (#47034715) Homepage

    Nooooooooo!!!

    • by Tablizer (95088)

      AT&T has one of the worst costumer service records. Removing competition is about as likely to improve customer service as a poke in the eye with a hot stick.

  • by Billly Gates (198444) on Sunday May 18, 2014 @08:09PM (#47034765) Journal

    We have too low prices and too much speed. Think of the poor telecoms! They are just struggling to stay relevant and if only they owned all the last miles then how could they grab amazon and Netflix by the balls and tripple dip since they already charge both ways?

  • by Rick Zeman (15628) on Sunday May 18, 2014 @08:38PM (#47034911)

    Two companies I refused to do (any more) business with trying to become one company I won't do any business with.

    How long til we end up with just ATT&T and Comcast as players?

  • The cynic in me (Score:4, Interesting)

    by Jahoda (2715225) on Sunday May 18, 2014 @09:02PM (#47035025) Homepage
    Cannot help but observe how convenient it will be for the American surveillance state when we have only two sources for delivery of media and internet to the home. But I'm sure this is just paranoid lunacy, right?
  • by John.Banister (1291556) * on Sunday May 18, 2014 @09:11PM (#47035061) Homepage
    A little over 10 years ago, Comcast merged with AT&T Broadband, which was the USA's largest cable television operator at that time. Now it comes down to one AT&T operation versus another. If divestiture hadn't happened, they might still be a utility, which is probably why we had divestiture.
    • by Lumpy (12016)

      I worked for AT&T broadband back then, and their management actually had a clue. Comcast came in and started the downward spiral.
      I remember sitting in on meetings talking about adding cameras to the cable boxes in order to count the number of people watching TV, at that time we already gathered information about what TV channels you were watching every 15 minutes, that data collection rate has increased in frequency I am sure.

      I would not be surprised if the new boxes had a type of very low res FLIR cam

      • My Dad was working for Comsat Etam when AT&T bought it, and worked there for another 9 1/2 years until he retired. He said that the bureaucracy that came in with AT&T was mind boggling. AT&T Broadband was fairly newly created before Comcast arrived. Did it manage to escape the traditional AT&T management structure, or did they just operate it better?
        • by Lumpy (12016)

          They escaped it by having the mother ship not know what to do with it. the whole cable TV biz confounded the top management so they left it alone for the short time it was standing on it's own.

          really big corporations have nooks and crannies where you can operate completely free of management and any obstruction. One of my friends went 3 years without ever knowing who his manager was, never had any calls to ask him to do anything ,etc... HR kept sending his paychecks. and he kept doing what he always d

          • I have to imagine that they capitulated in the short term and eliminated the dependance on one individual in the long run.
  • Customer growth with UVERSE was not happening fast enough -- content distributors (Disney/ESPN, premium movie channels, Scripps Networks, etc.) charged AT&T more because they did not have the subscriber numbers to leverage lower channel costs. After the merger, I expect those contracts to be renegotiated for much lower costs per subscriber for AT&T. Not that the consumers will see any of those savings...
    • I am afraid that, by owning a satellite television provider and a satellite internet provider, AT&T will proclaim that they have fulfilled the "universal service" mandate and refuse to upgrade any more legacy copper wire plant. There have been rumors that AT&T will not run new copper lines to a home or business if they are covered by any cell phone tower or any competing phone provider (including VoIP from another provider); nor will they replace faulty or noisy existing copper lines, since you coul
      • by l810c (551591) *

        I think this is actually the key thing in this discussion.

        I left their DSL and phone for Comcast a couple of years ago and cannot be happier. My Internet with Comcast Absolutely Rocks, Uverse just cannot match the speeds I'm getting with cable.

        They cannot compete with thin copper on internet speeds, so they are diversifying to video content.

        I will never go back to them.

        The problem:
        Comcast, (who's service I Love right now) will most definitely take advantage of this in the future and find a way to screw me.

      • by Lumpy (12016)

        Verizon does this as well, we have huge cables that are underwater and they refuse to replace them if your DSL is slow or if you have noise on your phone line. I am hoping that when they do some street construction this summer in the area, that when I point out to the backhoe operator that the cable there for Verizon is why his internet is slow it will be accidentally ripped out to force them to fix it.

        Although I am thinking of doing what a friend mentioned he used to do in NYC in the 80's to force the ph

  • Is this the "competition" that is supposed to "self regulate" the internet providers once net neutrality is dead?
    • by whistlingtony (691548) on Monday May 19, 2014 @12:57AM (#47035911)

      Yup. That finger in our ass is the invisible hand of the Free Market. :D

      Whenever someone tells me that the Free Market is better at regulating companies that government, I ask them to show me ONE example, since its so simple and easy. Just one. No, the gay hating wedding cake place doesn't count. Show me an example where a LARGE company EVER was punished by consumers for being assholes.

      I still remember watching people roll into the ARCO (Part of B.P., it's right on the sign) gas station near my house right after the B.P. oil rig spill in the Gulf. There was a Shell right across the street. People just didn't care. It was 5cents cheaper a gallon. That's less than a buck savings on a regular gas tank, and the ignorant !@#$ers didn't even think about it. It still bothers me to this day.

  • Satellite TV With UVERSE for backup due to rain fade even at a lower bit-rate will be so cool

  • by Greyfox (87712)
    You could probably buy a country with that much money. Like, if you offered Castro a large briefcase full of $48 billion, I think he'd probably go for it. Just saying, you can buy a shitty satellite TV company or Cuba. One of them, you can start assembling an army and working toward world domination. One you can beam reruns of "Friends" to customers you hate.
  • FCC, please explain to us how this merger would benefit us consumers.

    • by PaddyM (45763)

      Well, you see, when I retire from the FCC, I will have a paid position at AT&D and as a consumer I will be able to have more choices. And my money trickles down to the rest of the country, growing the money supply for everyone. This is how capitalism works and I can't really see how blocking the merger would benefit anyone. It clearly wouldn't benefit me. -- Any FCC Commissioner

  • How the fuck is that good for competition?

    Seriously I was being sarcastic, but how the fuck was that allowed to pass with the FCC?

    • by Lumpy (12016)

      The FCC chairman is a bought and paid for industry insider. He is making sure he gets a very good bonus when he leaves his position and goes back to his job in the private sector.

  • by Hamsterdan (815291) on Monday May 19, 2014 @12:53AM (#47035899)

    Say goodbye to affordable internet and tv boys & girls....

  • a sheit of a company buying another sheit of a company
  • Oh great, higher rates for crappier service. QOS is the last thing on AT&T's mind.

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