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AT&T Businesses The Almighty Buck

AT&T, Ready For Your $30 Billion DirecTV Haircut? (bloomberg.com) 30

Posted by BeauHD from the hot-potato dept.
An anonymous reader quotes a report from Bloomberg: AT&T is once again looking to sell its DirecTV unit, a business that has lost billions of dollars in value since the wireless carrier acquired it in 2015. The sooner it waves goodbye, the better. The question is, who wants it? DirecTV has faded into the background at AT&T, a company now entirely focused on competing in 5G wireless connectivity and online television. Any DirecTV user can attest to how the service has been neglected in recent years, and the business might be forgotten by investors if it weren't for the headline-grabbing subscriber losses it's mounted each quarter.

AT&T, which also owns the U-Verse brand, has lost about 6 million traditional pay-TV customers overall in just the last two years. The Covid-19 pandemic is causing cord-cutting to accelerate as consumers look to save money by switching to streaming-video services such as Netflix and AT&T's own HBO Max. So while AT&T paid $49 billion when it bought DirecTV, it'd be lucky to fetch even half that now. One analyst, John Butler of Bloomberg Intelligence, estimates a potential sale price of just $20 billion. Some may be wondering, what on earth would any buyer want with a satellite-TV business anyway? The answer is cash. DirecTV still throws off quite a bit of it, which explains why private equity firms including Apollo Global Management Inc. and Platinum Equity are said to be taking a look. Financial suitors want businesses that generate lots of cash because they can support dividends and the debt load needed to take them private -- although DirecTV's ability to do so is certainly diminishing.
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AT&T, Ready For Your $30 Billion DirecTV Haircut? More

AT&T, Ready For Your $30 Billion DirecTV Haircut?

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  • They got what they wanted (Score:3)

    by rsilvergun ( 571051 ) on Monday August 31, 2020 @06:10PM (#60460138)
    which was the Streaming tech & infrastructure. The actual "TV" part of Direct TV was always superfluous. I'm surprised they held onto it as long as they did.

    Kinda sucks for the employees & customers though.

    • Yep. Sometimes it is easier to buy into a market by buying an established player. There is less learning curve and you have the access to segway into streaming. Im surprised they did not just shut down the Satellites and convert everyone to streaming. They converted DirectTV Now! to ATT Now! and setup ATT WatchTV for a free 35 channel streaming service for their unlimited wireless plan customers.

      I saved a ton with my military discount moving the family to their unlimited plan and getting free streaming for

      • Re: (Score:2)

        by gantzm ( 212617 )

        > Im surprised they did not just shut down the Satellites and convert everyone to streaming.

        A lot of DirectTV customers don't have streaming available. They don't have access to a cable provider for internet. ( If they did they probably wouldn't be a DirectTV customer.) Their only internet options are probably cellular or some shaky wireless option that barely works. These customers are held to very low data caps that prevent any kind of streaming.

        People easily forget just how many people in this cou

        • I forgot to mention that with the ATT data plans, using the directtv/att streaming service does not count toward their data caps. But they would need at least 3Mbps to support a single stream of 720p. While 720p isnt super HD, it still looks good. Most cable, due to bandwidth limitations, could not broadcast all their HD in actual 1080p anyway. It was some scaled down HD that came out around 720p in actual resolution.

    • Kind of sad, since as a former DirecTV customer it was a very good service, and much cheaper than the Comcast alternative wth better service. The DirecTV+Tivo is still better than any cable+homegrown settop box crap. My mother has DirecTV now, super basic service, since she no longer can get over-the-air TV, and the UI is absolutely terrible in comparison to what I used to have.

    • The entire premise behind the federal court decision which found that the local cable monopolies were not in fact monopolies was that satellite TV networks provided competition. When AT&T (which is one of the local cable monopolies) bought DirecTV, it pretty much invalidated the reasoning behind that decision. So either they should've been prohibited from buying DirecTV, or allowed to buy but the local cable monopolies decalred to be monopolies.

      That wouldn't have made the subject to anti-trust regul
  • One of the most infuriating telemarketers. They target Indian-American community a lot, it appears. Constantly getting calls from them trying to sell direct tv. Spoofed caller id, bad accent, dumb operators, the works.

    Feel sorry for the guys getting yelled and abused on the phone by people they call, and also abused by managers for not meeting quota ... But when they call at the most inconvenient hours, very difficult to be sympathetic.

  • DiSH Network will buy them (Score:3)

    by kriston ( 7886 ) on Monday August 31, 2020 @06:34PM (#60460194) Homepage Journal

    Charlie Ergen is a gambling man. I totally expect DiSH Network will buy them for pennies on the dollar.

    DiSH has so many satellites in so many weird points in the sky they have been itching to consolidate their consumer satellite network for decades. They've got their old dual-dish systems, several generations of multi-satellite dishes (even weird three- and four-satellite receivers) in both the circular and linear bands.

    It's been a long time coming and he can probably buy them personally once negotiations are over if current SATS/DISH CEO Carlson demurs.

  • Slashdot editors are hitting all the right places for stories!

  • Try Microsoft and Wal-mart (Score:3)

    by edi_guy ( 2225738 ) on Monday August 31, 2020 @06:57PM (#60460266)

    Microsoft and Walmart seem to be interested in the area of vastly overpaying for an asset they have no idea how to develop, but only bought as some sort of knee-jerk defensive reaction.

  • Starlink is probably the final nail (Score:4, Interesting)

    by SuperKendall ( 25149 ) on Monday August 31, 2020 @07:12PM (#60460298)

    There's going to continue to be losses, but potentially DirectTV (and other Satellite TV services) always hd a base floor of people with no option for getting cable...

    Just one or two services like Starlink being around could easily mean that floor just drops right out. Suddenly for probably around the same amount t you got DirectTV only, you could get reasonably fast internet access and then just watch whatever video service you wanted to sign up for. Way more appealing than DirecTV.

  • Streaming has it's good points but the cost is steadily rising in the race to achieve channel lineup parity with cable and satellite. Pretty soon you're going to be right back where you started.

    Personally I like DirecTV and their huge channel lineup but I get that most people just watch a few channels or barely watch network TV at all.

  • Whoever buys this can fix it easy. (Score:3)

    by Narcocide ( 102829 ) on Monday August 31, 2020 @07:44PM (#60460386) Homepage

    Stop being dicks with the over-billing. Stop hiking prices. Stop moving all the good channels into higher-priced packges. Stop trying to ram that stupid Genie thing down everyone's throat by removing on-demand features and content from everyone else's DVRs then lying about it by saying it's a technical limitation. Stop pretending the HD Tivo models don't exist and don't support 3D.

    Basically, just stop being dicks. Everyone really likes the service in spite of the usury but we can only take so much indignity in a time of crisis.

  • DirecTV is... (Score:3)

    by FudRucker ( 866063 ) on Monday August 31, 2020 @08:11PM (#60460418)
    50% spammy home shopping channels its no wonder nobody wants to subscribe to it, and when you order it and look at the channel lineup in the brochure there is no mention of all the spammy home shopping channels you have to click through to find the good channels while channel surfing, you can lock them out but the next day when you turn your TV back on they are back, DirectTV is not worth having, hopefully DirectTV dies while AT&T still owns it and they have to eat it

  • ATT gets a haircut, US Taxpayer gets the Bill (Score:3)

    by schwit1 ( 797399 ) on Monday August 31, 2020 @08:33PM (#60460458)

    They will deduct the losses from their taxes.

  • I know the latency is awful, but I wonder what the bandwidth per dish is? There could be use cases where latency matters less than throughput where it make sense to use the existing infrastructure for something other than just almost live video. Maybe it becomes moot with the likes of Skylink, but being able to support several hd feeds at once off a single dish means it has at least a decent amount of bandwidth.
    • I am sure there is easily a gigabit per second of data hitting a directv dish. The generation just before I left the service was receiving from 5 different birds up in space, the older 3 Ku band ones and the newer 2 Ka band ones. Thought it might be less today than before the current generation of birds. The previous generation didn't have the ability to spot beam major metro areas. so, besides the hundreds of "typical cable" channels a customer could get, they could also get their locals over the dish, the
      • My guess the only re-purposing of those birds will be Dish buying the assets and keeping them as spares. Or if they have enough fuel on board for repositioning some other country's service provider could buy them and reposition them in orbit to service their county. Sat TV is still quite popular in some not quite so 3rd world countries because it doesn't require the outlay of infrastructure on the ground. The most cost effective if no one in the US wants them is some provider in in central or south america

  • I'm amazed that AT&T is still around. Whatever business they still have must be due to inertia and monopolies. Everyone I know who lives in "uverse territory" is trying to make do with 1.5 Mbps DSL. It's hard to cut the cord when throughput is that pitiful. Conventional cable and DirecTV only exist to fill the gaps for an internet service that barely supports one low resolution Netflix user.

    AT&T is still using phone wires as a transmission medium, as they have been in one form or another for wel

  • If you read business journals staring from the early 1970â(TM)s you will notice the pattern perpetuates. The reasons: 1) The real ROI of 40-60% per region caused by a legal loophole in tariff processing that uses current day replacement cost for fully depreciated copper distribution networks buried 50-100 years ago would embarrass the DOW so deeply that buying and forcing acquisitions to fail helps hide perpetuate the golden goose by covering it up with losses. 2) The gravy train given to favored ex e
  • I got really sick of the slow price hikes over the years. I live in a rural area with no high speed internet, and have to rely on satellite internet with serious data caps. So streaming is not an option at all, or you would use up all of your data. Every recent year, as I first subscribed in 1993, you would have to call them up and threaten to quit in order to reduce your bill rate as they added more fees, taxes, and all kinds of crazy service charges, that basically almost doubled your bill. It was up

    • Another option is a free to air service. Many parts of the world (my home UK being one example with Freesat) have a FTA satellite TV service that broadcast the same terrestrial TV content - plus extra channels - as an additional way to gain coverage without building out new land based transmitters.

      If Dish purchased DirecTV they would be in such a position to start such a service. FreeDish anyone?

  • Embrace and extinguish....they didn't even do the "extend" part.

    1) Buy a competitor
    2) Run them into the ground
    3) ?????
    4) Profit?

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