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AT&T Buying DirecTV for $48.5 Billion
AT&T is acquiring satellite TV provider DirecTV in a deal worth $48.5 billion. This will bring 20 million more U.S. television subscribers under AT&T's roof, making it the second biggest TV provider, behind Comcast. The deal is subject to regulatory approval, and to help that along, AT&T says it will sell its 8% stake in America Movil, which is a competitor to DirecTV in some areas.
"By acquiring the country’s biggest satellite television operator, AT&T will help bolster its competitive position against Comcast. Though pay television is considered a mature market whose subscriber growth has slowed dramatically in recent years, the business nonetheless generates billions of dollars in cash. ... Part of the attraction may be DirecTV’s ample cash flow. While its business has shown little growth in recent years, it generated about $8 billion in earnings last year. Much of that will go toward future investments in growth, AT&T said, including bidding at least $9 billion for wireless network capacity that the government plans to auction off soon. By gaining satellite TV, AT&T may also be able to free up capacity on its existing broadband network."
AT&T can't be allowed to get any bigger than it is now. They had to break it up once already.
They are the last real competitor to terrestrial cable tv. And the only one whose DVR was bright enough to back up 10s when you fastforwarded through a commercial and released when you saw the show start whizzin' by.
(-1: Post disagrees with my already-settled worldview) is not a valid mod option.
We know where all the money they should be using on upgrading their network is going.
Not that it really matters, but the majority of the deal is in stock...
Also known as "we now own you, and in exchange your stockholders now hold a smaller portion of our stock instead!
Only 30% of the deal is in cash, making it 14.5 Billion changing hands. Still a big number, but not as bad as it sounds.
As such, it actually comes out a touch cheaper than the cost that DirecTV spent on their satellites in the first place, and AT&T gets to exploit the 16% profit margin on DirecTV's lines of service.
Thirty four characters live here.
cable television is something noone cares about [in] the age of the internet
That might be true once decades-long carriage contracts between the networks and the cable system operators expire and once decades-long contracts between the major professional and collegiate sport leagues and the networks expire. Until then, we're left with games that get blacked out online if shown on national or regional cable networks.