AT&T, joining the ranks of U.S. television, Internet and wireless providers racing to consolidate, is in advanced talks to acquire DirecTV for about $50 billion, according to people familiar with the matter.
Under the plan, management of the largest U.S. satellite-TV provider would continue to run the company as a unit of AT&T, said the people, who asked not to be named because the information is private. DirecTV Chief Executive Mike White is likely to retire after 2015, the people said.
The purchase would give AT&T a national satellite-TV provider to combine with its wireless, phone and high-speed broadband Internet services as competition ramps up.
The pool of pay-TV customers is peaking because more viewers are watching video online, and the combination would keep DirecTV from being on its own with no competitive Internet package.
- Rolled semi spills 14 million bees on I-5 near Lynnwood
- Man's journey to find birth mom ends — at work
- 14 million spilled bees on I-5: 'Everybody's been stung'
- Shawn Kemp to co-host party celebrating Thunder missing playoffs
- Rolled semi spills load of bees at I-5 and I-405 interchange
Most Read Stories
“With DirecTV, they are getting a national TV presence; they can sell TV with wireless nationwide,” said Roger Entner, an analyst with Recon Analytics. “AT&T has increasingly been breaking out of their 22-state landline footprint. They sell wireless, they started selling home security and they could add TV to that package.”
AT&T would get a pay-TV business that’s expanding in Latin America and generating higher monthly bills from U.S. customers. DirecTV’s exclusive content includes the National Football League Sunday Ticket package and products such as Genie, a multiroom digital video recorder.
Comcast’s plan to acquire Time Warner Cable — to create an even bigger provider of both TV and Internet in the U.S. — is accelerating the drive for consolidation in the rest of the industry. In March, AT&T Chief Executive Randall Stephenson called the Time Warner Cable takeover an “industry-redefining deal.”
The question with all these potential tie-ups is whether regulators will allow them. Comcast’s takeover of Time Warner Cable hasn’t been approved yet. A merger of DirecTV and Dish Network was blocked more than a decade ago, and AT&T had to abandon a purchase of Bellevue-based T-Mobile several years ago in the face of antitrust opposition.
DirecTV and AT&T are planning on a 12-month regulatory process to review the deal, one of the people said.
“If regulators let Comcast buy Time Warner Cable, there’s no reason they wouldn’t let AT&T buy DirecTV,” Entner said. “They have to see it as part of a holistic market.”