News by Andrew Kameka on Monday May 19, 2014.
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The parent company of the nations largest wireless network operator and the largest satellite TV provider have agreed to a multi-billion dollar merger that would see the two companies become one. AT&T has announced plans to acquire DirecTV for $48.5 billion but the total cost of the deal will rise to $67.1 billion because AT&T will take on debt from DirecTV as well. The deal will take one year to close according to AT&T's estimates, and that's only if regulators approve the transaction. With AT&T and DirecTV being among the few choices that people have for home entertainment in some markets, it's difficult to imagine that the US government would allow the deal to move forward. The two companies will also have to contend with regulators in Latin America because DirecTV is the largest TV provider in the region and AT&T has a stake in America Movil, but it plans to sell that $5 billion stake in order to avoid conflicts.
Why AT&T would pursue this deal and how it might affect customers are two questions being asked since the proposed acquisition was announced yesterday. The answer to why is supposedly that this will better position AT&T to compete with cable television providers and give DirecTV a chance to bundle TV and internet services. It would also give AT&T more content deals to broadcast live and on-demand TV programs on mobile devices. DirecTV is able to broadcast NFL Sunday Ticket to mobile, so AT&T could offer that to its Uverse or mobile subscribers depending on how they navigate the maze of licensing agreements and subscription packages.
AT&T says that this proposed acquisition will not affect its plans to spend "at least $9 billion" in the 2015 spectrum auctions.source: AT&T
Andrew is MobileBurn.com's managing editor. He is based in Miami, Florida.