The date was May 12, 2014. That’s when reality set in. There had been rumors of a deal between AT&T and DIRECTV before that, but on that day, there was enough concrete evidence to say that it could really happen. In a post that was lost in our transition to a new platform, I wrote,
It could be happening after all. Or, it could just be one person’s imagination. Several sites including Marketwatch are reporting that a deal between AT&T and DIRECTV could come within weeks. Of course, that’s based primarily on rumor and speculation, since neither party has stepped forward to confirm any of the facts of the matter.
If a deal is announced, of course it would come under the same regulatory scrutiny as the Comcast/Time Warner Cable deal that’s been announced, and it’s far from certain that such a deal would be approved by the FCC. It’s also unclear what the timetable would be for merging the two companies or if there would truly be a merger at all.
Remember that at one point DIRECTV was owned by GM, and yet there are no DIRECTV-equipped Chevrolets; that they were once majority owned by News Corp. and yet it was not renamed Fox TV, and that Liberty Media once held quite a bit of DIRECTV stock yet there was essentially zero synergy between DIRECTV and any of Liberty’s vast other holdings. An ownership stake by AT&T doesn’t mean that U-Verse TV and DIRECTV would merge or share anything but a corporate parent, or that there would even be any bundle discount with AT&T products and DIRECTV.
It’s been said before, as tantalizing as it is to contemplate a future where DIRECTV has broadband access to a large part of the US, there is quite a long road ahead before consumers could see any benefit to a deal, while at the same time AT&T’s current customers would no doubt see some negative effects of their provider paying well over $50 billion (if that is a fair figure) for DIRECTV.
And a couple of days later…
Just four days later, the official notice came out. (That article is still available.) Yes, AT&T would be buying DIRECTV. At first it was categorized as more of a merger, and akin to the majority stock purchases that had been done by News Corp and Liberty Media. When the deal finally did close in July, 2015, we all started to see the truth.
AT&T implied almost from the start that they were not interested in DIRECTV as an pay-TV provider. They started talking about “AT&T Entertainment” instead of DIRECTV. Although the consumer never saw the name change, it was used internally for years.
I was optimistic at the time that there would be a lot of synergy from this deal. Sadly AT&T seemed only to be interested in using DIRECTV’s hard-won contracts to bolster its streaming-only platform. Development of new DIRECTV hardware stopped, and the strain slowly began to show. In February 2021, AT&T spun DIRECTV off again, becoming nothing more than a majority holder. Since then we’ve seen new hardware, new packages, and a renewed optimism at the company. It’s clear that there’s a lot of work still to be done, but that work is happening… fast. Best of all, AT&T’s dream of a strong streaming-only service didn’t have to be sacrificed. DIRECTV for Internet is now priced and promoted equally to DIRECTV for Satellite. So it’s a win-win.
