AT&T to purchase DirecTV for $forty eight.5 billion (up to date)

AT&T to buy DirecTV for $48.5 billion (updated)

AT&T clearly is not taking Comcast’s current acquisition efforts mendacity down; it simply introduced plans to purchase DirecTV in a deal value about $forty eight.5 billion. The communications big sees a takeover as a chance to increase the way it delivers video past simply the bundles it has at present. If officers approve the merger, AT&T might ship typical and web-based mostly video to nearly anywhere you occur to be, whether or not it is in your telephone or in mid-flight. This additionally represents a content material seize — DirecTV has the unique rights to NFL Sunday Ticket and different premium programming, so there’s an opportunity that a lot of its content material might attain U-verse and different AT&T choices.

The telecom is making loads of guarantees to assuage regulators that may little question take a look at the proposed mega-buyout very intently — AT&T clearly needs to keep away from a repeat of its failed try and purchase T-Cellular in 2011. It hopes to deliver excessive-velocity web entry to fifteen million further clients, primarily in rural areas the place a mixture of fastened wi-fi and fiber-to-the-residence might get individuals on-line. It is also guaranteeing web-solely service plans quick sufficient for on-line video (“at the very least” 6Mbps) for the subsequent three years, and it’ll honor the FCC’s 2010 internet neutrality guidelines (which usually forestall blocking or throttling web providers) for that very same time period. DirecTV’s stand-alone packages can be out there at constant costs nationwide throughout this stretch, too.

The transfer will not have an effect on AT&T’s plans to bid within the FCC’s upcoming wi-fi spectrum public sale, and it estimates that the acquisition will begin including worth inside a few yr of closing. Whether or not or not it closes is one other matter. The US authorities already has considerations concerning the potential anti-aggressive results of Comcast’s proposed buyout of Time Warner Cable; it is probably that the feds will take an identical strategy to AT&T and DirecTV. If Comcast runs into regulatory hassle, it will not be shocking if AT&T results in the identical boat.

Replace: Not surprisingly, shopper teams aren’t massive followers. Free Press contends that AT&T has “clearly run out of concepts,” and that the transfer is solely about eliminating competitors. Shopper Reviews‘ advocacy wing, Shoppers Union, additionally believes that People are getting a uncooked deal. You will discover its full assertion under.

On the heels of Comcast’s bid for Time Warner Cable, AT&T goes to attempt to pull off a mega-merger of its personal. These might be the beginning of a wave of mergers that ought to put federal regulators on excessive alert. AT&T’s takeover of DirecTV is simply the newest try at consolidation in a market the place shoppers are already saddled with awful service and worth hikes. The push is on for a few of the largest business gamers to get even greater, with shoppers left on the dropping finish. You possibly can’t justify AT&T shopping for DirecTV by pointing at Comcast’s seize for Time Warner, as a result of neither one is an effective deal for shoppers.

[Image credit: Associated Press]

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