Will AT&T Buy DIRECTV?

Satellite Internet Service

DirecTV Satellite

Talk is rife that AT&T is interested in purchasing satellite company DirectTV. IT seems that the phone company has already approached the satellite company offering to buy it. This news comes even as Comcast tries to acquire Time Warner Cable making this a very interesting time in the industry.

These occurrences are evidence of changes that are engulfing the arena of home video providers. This is keeping in mind that DirecTV and AT&T both compete with Comcast when it comes to the delivery of videos to homes. However, the two companies have not been able to properly compete with Comcast as they are not fully equipped to do so. This is because while AT&T doesn’t have enough subscribers signed up to U-verse (its video and broadband services), DirecTV has lots of subscribers but cannot offer good broadcast services on the internet due to satellite constraints.

The solution to these problems for DirecTV and AT&T is to come together so that they can have enough resources and subscribers to compete with Comcast. This may be the main reason for the rumored acquisition of DirecTV by AT&T. If it works, the latter will get DirecTV’s programmer relationships, the company’s growing lineup of original content, its sports deals and of course its customers. On the other hand, DirecTV gets a chance to offer phone and internet services alongside its video offerings.

DirecTV Share Prices Spike After News Of Possible Merger

When news of a possible merger between the two companies broke, DirecTV shares went up by nearly 6 percent and eventually settled at 3 percent. The news brings a ripple of excitement to the industry considering that the merger would rank the two companies in second position since their combined subscriber numbers would be about 25 million in number. Number one on the list will be Comcast and Time Warner if their union is approved by the government since after their merger, they will have a subscriber base of 30 million.

These are exciting times in the industry as companies fight to increase their footprint so as to have a strong say in the way that television and internet matters will be handled in the future. However, we can only exercise patience and see if this merger becomes a reality as AT&T has been linked to various mergers in the past that have not borne fruit such as the rumored merger with Vodafone last year.

 

UPDATE: AT&T to Acquire DIRECTV for $48.5 Billion.

http://about.att.com/story/att_to_acquire_directv.html

 

VIDEO: AT&T is Buying DirecTV in $48.5 Billion Deal

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